AUD/USD edged higher for the second successive day on Wednesday amid modest USD weakness. However, economists at Westpac expect the aussie to decline towards the 0.71 area as the Federal Reserve is widely expected to hike its policy rate later in the day.

Price action is often messy around the FOMC headlines

“Near-term, risks lie towards the 0.7100 area, with the US dollar benefiting from both haven/liquidity demand and what should be a hawkish tone from the FOMC as it delivers the first of many rate rises.” 

“Price action is often messy around the FOMC headlines but the contrast to a wary RBA will be stark, capping AUD/USD.”

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