Forex
AUD Holds Firm Amid Hawkish Fed and RBA Expectations
The Australian Dollar (AUD) remains relatively stable despite growing expectations of rate hikes from both the Reserve Bank of Australia (RBA) and the Federal Reserve (Fed).
The AUD/USD pair is trading around 0.7167, with a modest pullback in the US Dollar (USD) helping cushion the downside.
Recently, Fed Chair Kevin Warsh's speech at the Jackson Hole symposium fueled bets on a September rate hike, sending the US Dollar to over one-week highs and front-end Treasury yields surging.
However, the Greenback lost momentum on Monday and retraced most of its gains recorded on Friday.
The CME FedWatch Tool now shows a 65% probability of a 25-basis-point (bps) increase at next month's meeting.