Australian Dollar Approaches 2024 High as China Lowers Rates Ahead of RBA Decision

The Australian dollar hovered close to its highest level this year, following a strong session. Traders appear focused on how the Reserve Bank of Australia (RBA) will shape its policy later in the day. Though economists widely expect the RBA to hold interest rates steady, the market seems divided on the potential for cuts in the near term. Reuters’ poll of 44 economists shows just four anticipate a reduction by year-end, while traders see a roughly 60% chance of a cut. The Aussie received further support from China’s decision to ease its monetary policy. The People’s Bank of China announced a 50 basis point cut to banks’ reserve requirements, a move aimed at stimulating lending in an economy that has shown signs of slowing growth.

Read more to find out about the AUD outlook here.