Aussie hovers near 4-month peak against dollar, close to 13-year top on kiwi

Business Recorder reported that the Australian dollar held close to a four-month high on Monday, quoted at $0.7202 after a 0.6% weekly gain. Traders were looking ahead to two central bank appearances and a US inflation release, which could show whether the Aussie's rally has room to continue. The currency has climbed from its June low of $0.6867 and faces resistance near Friday's high of $0.7214.

The New Zealand dollar moved the other way, slipping 0.2% to $0.5871 after a 0.6% weekly fall. Investors blamed a surprisingly dovish Reserve Bank of New Zealand, with markets now assigning an 80% probability to a pause next month following two rate increases earlier this year. Traders are pricing in 67% odds that Australia's central bank lifts interest rates to 4.6% this month, which would be its fourth increase of 2026. That gap in expectations kept the Aussie close to a 13-year peak against the kiwi, at NZ$1.2268.

Analysts at the Commonwealth Bank of Australia expect the Aussie to hold around 72 cents for most of the week, though a strong US inflation report could push it back toward $0.7150. Higher oil prices, following attacks on ships in the Gulf by the US and Iran, lifted Australia's three-year bond yield by 2 basis points to 4.77%, just short of a five-year high of 4.832%.