Dollar Strength Delayed, Not Derailed - CommBank

The US dollar's upward momentum has been delayed, but not derailed, according to Commonwealth Bank. The recent softening of US economic data and intervention to support the yen have weighed on the dollar.

Despite this short-term setback, CommBank still expects the Federal Reserve to raise interest rates more than markets have priced. This will likely lead to a strengthening of the USD over the next two to three quarters.

The AUD is expected to weaken further due to higher US interest rates and lower metal prices.