AUD/USD Under Pressure as Chinese Economy Falters and RBA Rate Hike Expectations Rise

The Australian dollar is facing pressure due to problems in the Chinese economy and capital flowing back from Australia to the US as AI demand rebounds.

Expectations for RBA rate hikes appear overstated, with a 90% probability of a cash rate hike at the September 29 meeting but even this may not be enough to stop AUD/USD from falling sharply.

The Reserve Bank of Australia belongs to the group of central banks acting early on oil prices, raising rates in response, while others prefer to keep them unchanged.