AUD/USD eyes 0.70 target as UBS forecasts RBA outperformance vs Fed

AUD/USD has gained 0.3% to 0.6485 following a bullish forecast from UBS predicting the pair will reach 0.70 by early 2026. The investment bank expects the Reserve Bank of Australia to cut rates by only 75 basis points through Q1 2026, compared to 100 basis points from the Federal Reserve, creating a narrowing interest rate differential favorable for the Aussie. UBS cites Australia's resilient domestic economy, strong commodity export demand, and the RBA's cautious approach to easing as key supportive factors. Current technical levels show AUD/USD consolidating above 0.6450 support, with immediate resistance at 0.6520. A break above this level could accelerate gains toward 0.6600 and eventually the 0.6700 area. The medium-term outlook appears constructive, though near-term volatility remains tied to US dollar movements and China's economic performance.