RBA Governor Bullock’s Insightful Press Conference: Interest Rate Cuts & AUD/USD Reaction Explained
RBA Governor Bullock Emphasizes Data-Dependent Policy Outlook as AUD/USD Slides
By Bob Mason | Published August 12, 2025, 06:23 GMT
The RBA cut its cash rate by 25 basis points to 3.6%. The board made this move after checking the numbers. Governor Bullock spoke after the decision. She pointed out that the data now guides each choice we make. The report uses figures on inflation and job numbers to shape each step.
Key Insights from Governor Bullock’s Press Conference
Bullock said that every board member agreed on the rate cut. There was no talk of a larger fall. She noted that the RBA sees Australia’s neutral cash rate as a number between 3.1% and 3.4%. Bullock asked us not to fix our view on that range. She made clear that we focus on current trends in prices and work, not on a fixed target.
The governor said, "We don’t have a point estimate of where we might end up. The board has to take things meeting by meeting and absorb the data."
She shared the hard choices in moving rates. She warned that if rates stay the same, inflation could drop more but jobs might be at risk. Yet the present plan, which holds room for more cuts, builds a path for inflation to come back near the 2–3% target while work stays strong.
Bullock added, "Our inflation comes down slowly to the target, and the job numbers stay strong by historical standards. That is the good news. So far, it does not show that our rates were too high."
Updated Forecasts and Policy Expectations
Staff forecasts for August show a careful yet hopeful picture. The bank expects core inflation to fall toward the target. Unemployment numbers may keep to low marks seen in the past. The fast approach for policy means that any change will come as we watch new evidence from the economy.
Shane Oliver, Head of Investment Strategy and Chief Economist at AMP, said, "RBA forecasts see growth a bit lower than in May, with unemployment at 4.3% and inflation at target. The view is that more small cuts will bring rates to 2.9% next year. Without these cuts, inflation would drop more and jobs would suffer a rise. We see 0.25% cuts planned in November, February, and May."
Market Reaction: AUD/USD Experiences Volatility
After the RBA update and Bullock’s words, the Australian dollar moved quickly against the US dollar. At first, the AUD/USD rose to $0.65167 when hopes for more easing lifted the market. Soon after, it slipped below $0.65, as people grew wary of rate gaps that helped the US dollar.
During the press talk, the AUD/USD moved up a bit from $0.64987 to $0.65049. It then fell again to a low near $0.64937. As of trading on August 12, the AUD/USD was down about 0.19% at $0.64999. ### Looking Ahead
Bullock’s push for a data-focused plan tells us that market players have more uncertainty ahead. The meeting-by-meeting look means every new piece of economic data—from prices to job counts—will play a strong role in the future course of policy.
For those watching the AUD/USD and other Australian figures, the next months hold important changes as the market reads new signs from the RBA and the world.
About the Author:
Bob Mason brings over 28 years of work in finance. He covers currencies, raw materials, alternative investments, and global stocks with a focus on European and Asian markets. He has worked with top rating services and major banks.
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