The recent outbreak of hawkishness by policymakers in the western world does not automatically mean that interest rates need to rise in Australia, a top central banker said on Friday.
Canada's central bank increased interest rates to 0.75 percent this month while the U.S. Federal Reserve has raised rates four times over the past two years. Policymakers in Europe have also shifted to a less dovish stance.
That led some investors to build long positions in the Australian dollar in anticipation the Reserve Bank of Australia (RBA) might echo its global peers.
The local dollar surged to a two-year peak of $0.7992 this week. It last stood at $0.7934.
"Just as the policy rate in Australia did not need to decline to the very low levels seen in other parts of the world, the fact that other central banks increase their policy rates does not automatically mean that the policy rate here needs to increase," RBA Deputy Governor Guy Debelle said in a speech in Adelaide.