The Australian dollar faces a potentially volatile week, with traders preparing for major catalysts including the Federal Reserve’s policy decision, Australia’s quarterly inflation report, and renewed US–China trade discussions. With RBA rate-cut expectations building and global sentiment uncertain, AUD/USD could see sharp moves in both directions. US inflation data on Friday came in slightly softer than expected across the board, paving the way for the Fed to continue cutting rates. Fed funds futures implied a 98.3% chance of a 25bp cut next week and a 91.1% probability of another in December.
