AUD/USD Supported as Bets on June RBA Hike Increase

0546 GMT — AUD/USD has lifted to near 0.6605 because of a positive repricing of RBA rate hikes and a stronger CNH, says Carol Kong, currency strategist at Commonwealth Bank. It traded closer to 0.6500 earlier in the week. Australia’s Fair Work Commission’s announcement of a 5.75% wage rise for low income earners shouldn’t worry the RBA, but the upside surprise in the April monthly CPI indicator means next week’s RBA policy meeting could well deliver a further interest rate hike, Kong says. CBA’s baseline remains for the RBA to leave the cash rate on hold next week. The market has priced in a 40% chance of a 25bp rate increase on Tuesday, compared with bets of 25% prior to the wage decision. (james.glynn@wsj.com; @JamesGlynnWSJ)