AUD/USD Forecast: Rate Hike Decision Set to Bolster Aussie Dollar

The week has started on a sour note for stocks, gold, silver, and Bitcoin, as crude oil prices rebounded and bond yields continued to rise.

The market's disappointment stems from US President Trump's refusal to agree to Iran's proposal to re-open the Strait of Hormuz, but there are reports that mediators will hold talks with the two sides on an amended version of the 7-day proposal.

This has kept hopes alive for some progress in the region. Meanwhile, economic data will take center stage this week, particularly the August PCE inflation report due on Wednesday and the September jobs report on Friday.

The Reserve Bank of Australia's rate decision is also highly anticipated, with a 25bp rate hike to 4.60% widely expected. Markets have fully priced in the move, leaving the Australian dollar's reaction largely dependent on how much further tightening Governor Michele Bullock signals may be required.