AUD Soars as RBA Keeps Hawkish Tone Amid Weaker US Data

The Australian Dollar (AUD) has risen for the second consecutive day, trading around $0.7090 during Asian hours on Monday. The AUD/USD pair appreciates as the Reserve Bank of Australia (RBA) maintains a firm tone and Governor Michele Bullock declares that the bank would not hesitate to act if needed.

Rabobank's strategy team remains doubtful that the RBA's tightening cycle is complete, citing recent communication from Governor Bullock that does not fully close the door on further action. They reiterate that they are 'unconvinced' the current policy stance will be sufficient and therefore continue to expect one more hike later this year.

The US Dollar (USD) declines amid weaker-than-expected US economic data and shifting central bank expectations. The Retail Sales fell by 0.6% month-over-month in July, below the market consensus of 0.1% growth. Traders have reduced their bets on Federal Reserve rate hikes following a slew of softer US data.