Rabobank expects one more RBA rate increase this year despite markets pricing only 12 bps of tightening over three months.
The Australian Dollar fell to the weakest G10 currency on a one-day basis, pressured by softer Chinese demand and domestic economic headwinds. AUD/USD remains under strain despite hawkish remarks from RBA Deputy Governor Hauser, with markets pricing just 12 bps of rate hikes over the next three months.
Rabobank maintains its call for one additional RBA rate increase this year, contrasting with market skepticism. Weakness in Chinese commodity demand and energy-related trade shocks add to near-term downside risks, though the bank still forecasts a shallow AUD/USD uptrend into 2025.
Safe-haven USD flows could push AUD/USD toward 0.70 in the short term, but November’s potential RBA hike and Fed policy expectations may support a gradual recovery.