FX.co ★ Australian Dollar Edges Higher

The Australian dollar advanced to approximately $0.66 on Monday, building on the gains from the previous week as investors assessed the latest inflation data. According to the Melbourne Institute’s Monthly Inflation Gauge, there was a 0.4% increase in September 2025, recovering from a 0.3% decline in August. This upturn indicates that third-quarter inflation might be more robust than anticipated, while the Reserve Bank of Australia (RBA) aims to keep price growth within its target range of 2-3%. The RBA maintained interest rates at 3.6% in September but acknowledged persistent inflation pressures, especially in market services, amid a tight labor market. Despite most economists predicting a rate cut in November and another in 2026, the market remains cautious, with only a 40% likelihood of a cut priced in for next month. Attention now shifts to upcoming speeches from RBA officials this week, which are expected to shed more light on the central bank's policy direction.