The Australian dollar edged higher to approximately $0.658 on Tuesday, marking its third straight day of gains. This upward movement can be attributed to the weakening of the US dollar amidst escalating concerns about a looming government shutdown. The government faces a funding lapse at midnight on Tuesday unless a last-minute deal is brokered between Republicans and Democrats. However, a meeting at the White House between President Donald Trump and opposition leaders showed limited progress.
On the domestic front, private sector credit increased by 0.6% month-over-month in August 2025, aligning with market expectations but slightly down from a 0.7% rise in July. At the same time, the seasonally adjusted number of total dwellings approved experienced a 6% month-on-month decline to 14,744 units in August, slightly improving from an upwardly revised 10% drop but contradicting the anticipated 3% growth. Investors are now keenly awaiting the Reserve Bank of Australia's interest rate decision later today, with the market widely expecting the central bank to maintain the Official Cash Rate at 3.60%.
