RBA Meeting Kicks Off Central Bank Week

Daily Market Insights – December 9, 2025 | Ultima Markets

Today is a high-stakes session for the Australian Dollar (AUD) as the Reserve Bank of Australia (RBA) delivers its final policy decision of the year, ahead of the crucial U.S. Federal Open Market Committee (FOMC) meeting, which also begins today.

Policy Forecast: Rate Hold, Hawkish Tone

The RBA is expected to hold the official cash rate at 3.60%, as widely anticipated for the December meeting.

Inflation remains the central focus. The latest trimmed mean inflation figure—the RBA’s preferred metric—rose to 3.3% in October, exceeding the central bank’s 2–3% target band. Strong domestic demand and a tight labor market (4.3% unemployment) further support a cautious approach.

Market attention will be on the policy statement and Governor Michele Bullock’s commentary. Ultima Markets analysts anticipate a “Hawkish Hold”, suggesting the RBA acknowledges upside inflation risks and remains prepared to hike rates in the first half of 2026 if necessary, reversing earlier easing expectations.

**More updates will follow after the RBA press conference.

**Post RBA Press Conferences Update

RBA Press Conference Highlights

Governor Michele Bullock’s comments on December meeting were notably “hawkish” (leaning towards higher rates), significantly dampening any hopes for near-term rate cuts.

Bullock explicitly stated that the Board did not consider a rate cut at this meeting. In a surprise to some dovish traders, she admitted the Board actively discussed scenarios that would require a rate hike in 2026.

• Inflation Concerns: The Governor emphasized that while inflation has fallen from its peaks, recent monthly CPI data has been “sticky” and has picked up slightly. She noted that risks to inflation are now “tilted to the upside.”
• Forward Guidance: The message was clear: The RBA needs “clear evidence” that inflation is durably returning to the target band before it will resume cutting rates. The “last mile” of the inflation fight is proving difficult.

The Reserve Bank of Australia has effectively slammed the door on near-term rate cuts, delivering a hawkish surprise that puts a potential 2026 rate hike back on the table.

The RBA’s “hawkish hold” has significantly altered the playing field for the Australian Dollar. In the coming weeks, the primary driver for AUD/USD will be Policy Divergence.

AUD/USD Outlook: Coiled for a Move

The AUD/USD pair is currently trading near 0.6620, making it highly sensitive to RBA communication. The recent breakout from a converging range suggests a bullish bias, with upside potential especially if the RBA leans toward a hawkish hold.

AUD/USD, Daily Chart Analysis | Ultima Markets MT5

• Bullish Scenario (Hawkish RBA): If Governor Bullock signals a hawkish hold or hints at potential future rate hikes, the AUD is likely to catch a strong bid. This could push AUD/USD toward the 14-month high at 0.6700, particularly if the Fed delivers a dovish outcome tomorrow.
• Neutral Scenario (Dovish Hold): A neutral statement, keeping all options open without a hawkish tilt, may be interpreted as relatively dovish in light of strong inflation data. This could weigh on the AUD, driving the pair back into its recent 0.6500 range.

Overall, the outlook for AUD and AUD/USD remains bullish, supported by both technical momentum and the macro picture on the central bank front.

What to Watch Today

Today marks the start of the final, decisive FOMC meeting of 2025. Key focus points for the market include:

• FOMC Meeting Begins: The Federal Reserve’s last policy meeting of the year kicks off today. Markets currently price in an 84% probability of a 25-bps rate cut, but tomorrow’s policy statement will provide clarity on the Fed’s tone and forward guidance.
• US Data: NFIB Business Optimism Index (6:00 AM ET): This small-business survey is the only tier-one U.S. economic release today. Given the recent mixed labor data, traders will look for signals on hiring intentions and investment plans to assess economic strength ahead of the FOMC statement.
• JOLTS Job Openings (10:00 AM ET): Delayed from the previous shutdown, this report measures labor demand. A weak JOLTS reading would add weight to the Fed’s dovish case for rate cuts, while stronger-than-expected data could complicate the narrative.

Disclaimer

Comments, news, research, analysis, price, and all information contained in the article only serve as general information for readers and do not suggest any advice. Ultima Markets has taken reasonable measures to provide up-to-date information, but cannot guarantee accuracy, and may modify without notice. Ultima Markets will not be responsible for any loss incurred due to the application of the information provided.