Australian Dollar Remains Steady
The Australian dollar was little changed around $0.71, struggling to sustain its rebound from a recent four-week low as firmer US dollar offset bets of an RBA rate hike next week, which is now largely priced in. Governor Michele Bullock said upside inflation risks may be materializing, pointing to persistently high energy prices and continued excess demand in the domestic economy. Earlier, Assistant Governor Sarah Hunter also reiterated that interest rates might need to rise for a fourth time this year to curb inflation. Markets are now pricing a 95% chance of a 25bp hike to 4.60% on September 29, with rates seen peaking at 4.85% early next year. Meanwhile, the greenback remains firm as remarks from Fed officials in the wake of its policy decision have flagged the possibility of more rate hikes if inflation does not cool. Elsewhere, traders watched the upcoming US-China summit for signs of trade progress, which could support the Aussie given Australia’s strong trade ties with China.
71, struggling to sustain its rebound from a recent four-week low as firmer US dollar offset bets of an RBA rate hike next week, which is now largely priced in. Governor Michele Bullock said upside inflation risks may be materializing, pointing to persistently high energy prices and continued excess demand in the domestic economy. Earlier, Assistant Governor Sarah Hunter also reiterated that interest rates might need to rise for a fourth time this year to curb inflation. 85% early next year.
Meanwhile, the greenback remains firm as remarks from Fed officials in the wake of its policy decision have flagged the possibility of more rate hikes if inflation does not cool. Elsewhere, traders watched the upcoming US-China summit for signs of trade progress, which could support the Aussie given Australia’s strong trade ties with China.