The Australian dollar rose in Asian trade on Wednesday on track for the third straight profit against the US dollar, as the risk appetite improved in the markets following the Israel-Iran ceasefire.

Aussies gains are stymied by weak inflation data in Australia, boosting the odds of an RBA interest rate cut in July.

The Price

The AUD/USD price rose 0.25% today to $0.6508, with a session-low at $0.6488.

The Aussie rose 0.45% on Tuesday against the US dollar, the second profit in a row following the Israel-Iran ceasefire.

US Dollar

The dollar index fell 0.15% on Wednesday, expanding the losses for the third straight session against a basket of major rivals.

The US dollar has been hurt by bearish remarks from Fed Chair Jerome Powell, boosting the odds of a rate cut in the second half of the year.

Australian Inflation

Australias consumer prices rose 2.1% y/y in May, below estimates of 2.3%, and down from 2.4% in the previous reading.

Following the data, the markets now expect 70 basis points of interest rate cuts overall by the Reserve Bank of Australia by the end of the year.

The odds of a 0.25% rate cut in July rose from 65% to 75%.

The RBA cut interest rates twice since February to 3.85%, as inflation slowed to the 2-3T target.