AUD Gains as Fed's Hawkish Tone Boosts US Dollar

The Australian Dollar gained ground despite a cooling domestic inflation rate and a hawkish stance from the Federal Reserve.

The AUD/USD currency pair inched higher after two days of losses, trading around 0.6960 during Asian hours on Thursday.

Australia's 10-year government bond yield fell to 4.9% as June inflation data came in lower than expected, reducing the likelihood of another rate hike this year to 50% from over 90% prior to the release.

The Federal Reserve kept interest rates steady at its July policy meeting, but a dissenting vote from three policy members, including Dallas Fed President Lorie Logan and Cleveland Fed President Beth Hammack, suggests that some committee members believe a rate hike is necessary to combat inflation.