The Australian dollar traded around $0.664, hovering close to its highest level in nearly three months, supported by the Reserve Bank’s hawkish monetary policy outlook. The central bank held cash rates steady as widely expected at its December meeting, while Governor Michele Bullock took markets by surprise with a sharply hawkish shift on rates by ruling out further cuts and signaling the possibility of rate hikes as soon as February if inflation fails to ease. Still, the RBA later emphasized that there is no preset policy path, with future adjustments depending on the inflation outlook. Markets quickly priced in a 30% chance of a 25 bps hike at the RBA’s February meeting, rising to nearly 100% by May. Rising local bond yields also drew carry traders, adding further upside to the currency. Investors are now focused on Australia’s November jobs data due Thursday, while globally, markets await the US Federal Reserve’s policy decision later today, with expectations for a 25 bps cut.