The AUD/USD pair continues to plunge, marking new lows.

The Australian dollar, paired with the US dollar, is intensifying its decline, with the current AUD/USD exchange rate at 0.6564.

Currently, the AUD is approaching levels seen on December 13, 2023.

The Reserve Bank of Australia perceives the current interest rate of 4.35% per annum as the peak. Earlier expectations of an interest rate hike at the February meeting have lost credibility.

Market sentiment is undergoing a shift as investors now anticipate the interest rate to remain unchanged until November, after which a potential decrease might commence. The average forecast suggests a reduction in borrowing costs by 125 basis points, reaching 3.10% per annum by the end of 2025.

With a likely decline in inflation in Q4, the RBA may find insufficient grounds for a rate hike, adding to the downward pressure on AUD positions.

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