Australian price statistics for July came in higher than projected. The elevated price metrics raised the risk of an interest rate hike by the Reserve Bank of Australia. Top lenders ANZ and CBA adjusted their policy expectations following the report. Both ANZ and CBA are now predicting a policy rate hike in November. Westpac maintains a distinct Reserve Bank of Australia policy perspective.
The higher inflation figures and climbing policy tightening expectations lifted the Australian dollar up versus the US dollar. The gain in the exchange rate came after the unexpected inflation report.