Traders price in a 60% chance of a Fed rate hike by September, lifting the USD and pressuring the AUD ahead of RBA minutes and China PMI data.
AUD/USD declined for a third straight session, trading near 0.6870 in Asian hours as the USD strengthened on rising Fed rate hike expectations. Markets now assign a nearly 60% probability of a September hike, bolstered by upcoming US labor data, including Thursday’s Nonfarm Payrolls report.
Investors await the RBA’s latest meeting minutes and China’s PMI figures, both due later today. Forecasts suggest US job growth slowed to 114,000 in June, while the unemployment rate is expected to hold at 4.3%. Geopolitical tensions, including US-Iran relations, have also supported the USD’s safe-haven appeal.
The Australian Dollar’s weakness reflects broader risk sentiment and anticipation of key economic releases, which could shape central bank policy outlooks.