Ella 
The Australian Dollar (AUD) retreated slightly on Monday, hovering near its six-month peak of 0.6798 reached last Thursday. China, a key trade partner of Australia, reported a 4.7% year-on-year growth in Gross Domestic Product (GDP) for the second quarter, down from 5.3% in the first quarter and below the anticipated 5.1%. This weaker-than-expected GDP data from China may exert mild downward pressure on the AUD/USD pair.
Speculation persists that the Reserve Bank of Australia (RBA) could delay aligning with global rate cuts or even consider raising interest rates further, buoyed by ongoing high inflation levels domestically.
Meanwhile, the US Dollar (USD) strengthened amid heightened risk aversion following an attempted attack on former US President Donald Trump over the weekend. Analysts suggest that increased uncertainty could bolster the USD and steepen the US Treasury yield curve if it enhances Trump’s electoral prospects—a scenario dubbed as potential ‘Trump-victory trades’ by Reuters.
The AUD/USD pair may find support as expectations mount for a Federal Reserve (Fed) rate cut in September, driven by softer US Consumer Price Index (CPI) figures for June, which have tempered the USD’s strength.
