The Australian dollar held above $0.72, near a four-month high as growing expectations of another interest rate hike by the Reserve Bank continued to support the currency, while the US dollar remained broadly weaker. The greenback struggled to sustain the brief lift it received from a ramp-up in US rate hike bets following Friday’s blowout US jobs report. Caution prevailed ahead of Friday’s US CPI report, which could influence expectations for the Fed’s policy path. In Australia, strong GDP growth and inflation data have increased expectations that the Reserve Bank will raise rates again at its meeting later this month. Markets are now pricing in a 66% chance of a quarter-point hike to 4.60%, up sharply from just 10% a couple of weeks ago, while the odds of a further increase to 4.85% have risen to 50%. Meanwhile, ongoing tensions in the Middle East have heightened concerns over broader inflationary pressures, raising the prospect that central banks could keep tightening policy.