The RBA cash rate already sits at a record low of 2.5 percent, leaving the central bank with little space for further loosening of monetary policy, despite worries about the effects of a strong AUD on Australia's exporters.
In its September 3 meeting, the RBA held rates, with the board moving to "neither close off the possibility of reducing rates further nor signal an imminent intention to reduce them."
AUD/USD climbed to USD0.9498 last week on news that the US Federal Reserve would not be tapering its monthly asset purchase programme as expected. But despite RBA willing it, the AUD has failed to break below USD0.8900 at any point in the last 12 months.
Given the RBA's continued focus of poor Australian business confidence numbers, the central bank will be hoping that the change of government that happened on 7 September will help to give confidence some positive momentum.
Despite the RBA's record low rates, Australia has so far avoided a significant housing bubble. Due to strict planning regulations, Australia has traditionally suffered from supply problems. However, should it see any significant rises, the RBA may be stuck between a rock and a hard place - accelerating property price inflation, but with an economy too weak to withstand a rate hike to curtail inflationary pressures.
With FOMC voting member and St Louis Fed president James Bullard last week hinting that a small tapering of the Fed's USD85bn monthly asset purchases could be possible in October, we could see some RBA pleasing bearishness in AUD/USD. However it is unlikely that this bearish trend will be accelerated by a further near-term rate cut.