RBA looks poised to hike again in MayOffering support to AUDSydney house prices see a revivalChinese GDP beats expectationsBut, the data was not outright supportive of AUD

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The Australian Dollar is outperforming its major peers after it was revealed the Reserve Bank of Australia's (RBA) decision to pause raising interest rates in April was finely balanced.

The minutes of the RBA's April policy meeting - which saw the rate kept at 3.60% - revealed a 25-basis-point hike was in play, which sends a signal to markets that further rate hikes from the central bank are more likely than previously assumed, in turn supporting the Australian Dollar.

"The May decision remains a close call," says Jarek Kowcza, Senior Economist at St.George Bank in Sydney.

The Pound to Australian Dollar exchange rate was softer in the wake of the news at 1.84448 amidst the broader AUD uplift. (Pound to Weaken against Australian Dollar Forecast UBS Strategists).

The Australian Dollar to U.S. Dollar rate was half a per cent higher at 0.6732. "AUD/USD increased modestly after the release of the RBA minutes," says Joseph Capurso, a foreign exchange strategist at Commonwealth Bank of Australia.

"We expected the April Board Minutes to be a low-key affair... but the April Board Minutes contained quite a lot of interesting information," says Capurso's colleague, Gareth Aird, who heads Australian economics research at CBA.

Aird says, on balance, the minutes reflect a central bank that believes they will probably increase the cash rate again.

"The RBA will be watching key economic data to determine whether to hike or pause again, including developments in the global economy, trends in household spending and the outlook for inflation and the labour market. The March quarter inflation report will likely tip the scales one way or the other," says Kowcza.

Turning to incoming data, it is revealed the recent pullback in Australian house prices might be easing, which if accurate, will take the pressure off households and support demand in the economy.

A report by Bloomberg Intelligence reveals house prices in Sydney — a bellwether for the Australian real estate market - "may have found a floor as a home shortage and the central bank’s rate-hike pause stem declines".

The report reveals Sydney posted the biggest monthly price gain at 1.4% in March, followed by Melbourne and Perth, resulting in a 0.8% increase for Australia's major cities.

The RBA might be inclined to hike again in May if this housing market data proves part of a trend of improvement elsewhere in the economy.

Australia's economy is heavily exposed to the fortunes of China and the reopening of the world's second-largest economy is tipped by analysts to put some wind into Australia's sails over the coming months.

But, CBA analysts reckon the Aussie Dollar might have missed out on the Chinese data as a breakdown of the figures reveals some disappointment.

"The composition of the surprise in China’s economic data is unfavourable to Australia. Chinese industrial production and fixed investment – heavy users of Australian metals – were weaker than expected in March," says Capurso.

"The limited policy support for infrastructure spending by the Chinese authorities is a weight on demand for Australian metals. We expect the China‑boost to AUD to fade today," he adds.