Markets Now Put RBA September Hike Above 70%. How Far Can AUD/NZD Run?

Financial markets have sharply repriced expectations for the Reserve Bank of Australia, now assigning a 71.2% probability to a 25 basis point interest rate hike at the September 29 meeting, raising the cash rate to 4.60%. The hawkish reassessment follows remarks from RBA Deputy Governor Andrew Hauser and Assistant Governor Sarah Hunter emphasizing persistent above-target inflation in services, construction, and rents, alongside soaring energy costs as Brent crude topped $100 per barrel. Major investment banks, including Goldman Sachs and Macquarie, now anticipate a September hike, while Westpac and RBC project a move in November. This relative-rate divergence has driven a decisive technical breakout in AUD/NZD above the crucial May resistance level of 1.2283. Price action is currently trading near 1.23, backed by strong daily MACD momentum, although a daily RSI reading of 73.78 indicates overbought conditions that could prompt short-term consolidation. From a technical perspective, as long as key support at 1.2211 holds, the broader bullish trend remains intact. The next major upside target zone sits between 1.2534 and 1.2608, representing key Fibonacci projection levels of the multi-year advance.