The chances of an RBA interest rate cut in the next few month have climbed in the wake of the US Federal Reserve's latest meeting.

The Reserve Bank is all but certain to cut interest rates in the next few months after its US counterpart, the Federal Reserve, signalled it may hold off on long-expected rate hikes.

The Fed was widely predicted to start lifting its key interest rate, which has been close to zero for years, in June but that expectation fell apart overnight after the central bank downgraded its economic growth and inflation expectations for the US.

That move was part of what many economists saw as a "dovish" - meaning less supportive to rate increases - statement from the central bank early on Thursday and many now expect the Fed to wait until September before making what would be the first rate hike in nine years.

And that's had a significant impact on Australia, pushing both the Aussie dollar and share markets higher and increasing the odds of another RBA rate cut.

Money markets are now pricing in a 100 per cent chance of a rate cut in April or May, while the Australian dollar has climbed almost two cents to 78 US cents.

Meanwhile, the ASX200 has jumped more than 1.5 per cent and the Commonwealth Bank's share price has hit a record high of more than $95 per share.

Credit Suisse Australia chief investment strategist David McDonald said the move would push the US dollar lower and thereby lift the Aussie dollar, which would remove some much needed stimulus from the economy and make the RBA more likely to cut the cash rate to a record low of two per cent.

"Locally we do expect another RBA rate cut and this probably increases the chances of that given that if the Fed's not going soon, it's likely to give the Aussie dollar a bit of a boost," Mr McDonald said.

"So I think it might make it a little easier for the RBA to cut."

The Australian dollar is widely expected to weaken once the Fed eventually starts lifting rates.

Credit Suisse expects the Australian dollar to fall to around 70 US cents over the next year.

That would help the economy by making Australia more attractive to tourists and making exporters more competitive with international counterparts, which in turn could reduce the need for future rate cuts.

In fact, Bank of America Merill Lynch chief economist Saul Eslake this week said a lower Australian dollar would lift the economy enough for the RBA to start lifting rate again.

He expects the RBA to cut in May and then to lift it back to 2.25 per cent by the end of the year and to 2.5 per cent in early 2016.