AUD Holds Firm as RBA Rate Hike Bets and US Economic Data Drive Market Expectations

The Australian Dollar (AUD) has maintained its strength for the third consecutive day, trading around 0.7180 during Asian hours on Thursday.

This resilience is driven by heightened expectations of an upcoming Reserve Bank of Australia (RBA) interest rate hike, following a hotter-than-expected July inflation report that signaled persistent price pressures.

National Australia Bank (NAB) now anticipates a rate increase to 4.6% at the September meeting, while Commonwealth Bank and ANZ project a move in November with a distinct risk of an earlier action.

The RBA's warning that further monetary tightening remains on the table if inflationary risks escalate has also contributed to the AUD's underlying strength.