• The Australian Dollar has weakened following the release of softer Retail Sales data.
• The Australian Dollar could regain ground due to growing expectations of the RBA delaying interest rate cuts.
• The US Dollar has rebounded, possibly from hawkish comments made by Fed officials, signaling no immediate necessity for rate cuts.

The Australian Dollar (AUD) extended its downward correction following Tuesday's release of lower than expected domestic Retail Sales data. Retail Sales are a key leading indicator directly correlated with inflation and growth prospects, potentially influencing the Reserve Bank of Australia's (RBA) hawkish stance on interest rate trajectory.

The Australian Dollar could potentially regain its footing, buoyed by higher-than-expected domestic inflation data released last week, which has raised expectations that the RBA may delay interest rate cuts. Furthermore, Commonwealth Bank, Australia's largest mortgage lender, has revised its forecast for the timing of the first interest rate cut by the RBA, now projecting only one cut in November, as reported by the Financial Review.

The US Dollar Index (DXY), which gauges the performance of the US Dollar (USD) against six major currencies, has rebounded following hawkish remarks from US Federal Reserve (Fed) officials, indicating no immediate need for rate cuts.

Traders are anticipated to await Wednesday's release of the ADP Employment Change and ISM Manufacturing PMI from the United States (US), alongside the Fed Interest Rate Decision. These events are likely to influence market sentiment and USD movement.