According to UBS, recent interest rate cuts by the Reserve Bank of Australia (RBA) have significantly influenced the Australian Dollar (AUD). The RBA reduced rates by 25 basis points to 3.85% on May 20, meeting market expectations. Nonetheless, the AUD/USD exchange rate dipped sharply to beneath 0.6400 before clawing back to around 0.6465. UBS suggests the Australian Dollar is currently over-sold, projecting a recovery with a target of 0.70 by March 2026. Investors should keep a close watch on the AUD’s trajectory.