FX.co ★ Aussie Dollar Sideways Near 2-Week Low

The Australian dollar remained steady at approximately $0.650, hovering near its lowest point in two weeks. This is occurring as investors balance the Reserve Bank of Australia's (RBA) assertive policy approach against a cautious global risk sentiment and a strengthening US dollar. The minutes from the RBA's November meeting revealed that the central bank could maintain its current interest rates for a prolonged period if economic data continues to exceed expectations. Recent statistics indicating stable wage growth in the third quarter, alongside last week's positive employment figures and persistent inflation rates, have strengthened the belief that the cycle of easing is concluding. Market swaps currently suggest only a 50% chance of a final RBA rate cut in May of the following year. Concurrently, the Australian dollar, commonly used as an indicator of risk due to the nation's dependence on commodity exports tied to global economic growth, remains pressured following a decline in global stocks amid concerns about inflated artificial intelligence stock valuations. Additionally, a robust US dollar has contributed to this pressure, as investors adjust their expectations away from an immediate Federal Reserve rate cut in anticipation of significant economic data releases.