The Australian dollar rose to above $0.71 on Thursday, extending its rally to a fresh three-and-a-half-year high after the central bank signaled another hawkish policy stance. RBA Governor Michele Bullock said the board remains ready to lift rates further if inflation proves persistent, describing any inflation “with a three in front of it” as unacceptable. Her comments reinforced warnings from Deputy Governor Hauser, who noted just a day earlier that inflation remains too high and continues to pose a major challenge for the rate-setting board. A consumer survey was released shortly after her speech showing inflation expectations jumped to 5% in February, the highest since mid-2025, reinforcing the hawkish tone. Economists now widely expect a possible rate hike in May, as the RBA weighs first-quarter inflation data alongside upcoming employment and GDP reports. Assistant Governor Sarah Hunter is also scheduled to deliver a speech in Perth later Thursday, offering additional insight.