AUD/USD Holds Steady as RBA Pauses at 4.35%; Oil Prices Extend Decline

AUD/USD traded in a consolidative range during the European session as the Reserve Bank of Australia held its cash rate unchanged at 4.35%, in line with market expectations. The decision marks a pause after three consecutive rate hikes earlier in 2026, with policymakers opting to assess the lagged effects of prior tightening on consumer demand, housing activity, and inflation dynamics. Meanwhile, crude oil prices extended their losses as the US lifted its naval blockade in the Middle East, easing supply disruption fears and removing a key risk premium from energy markets. The decline in oil prices typically weighs on commodity-linked currencies like the Australian dollar, but the RBA's hawkish tightening cycle has provided underlying support. Traders are now watching for upcoming Australian employment data and inflation prints to gauge whether the RBA will resume hiking or shift toward a prolonged hold. Near-term support for AUD/USD sits near the 0.6600 handle, while resistance is seen around 0.6680. The interplay between falling oil prices and a still-hawkish RBA stance creates a mixed outlook for the pair.