Institution: Australian pension fund's hedge will boost the Australian dollar.

Ray Attrill, the head of foreign exchange strategy at National Australia Bank in Sydney, said that tariff risks and bets on a rate cut by the Federal Reserve should weigh on the US dollar. By then, Australia's largest pension funds may have to increase their currency hedging for their US assets. This will play a key role in the demand for the Australian dollar. In addition, the second quarter inflation data released on Wednesday could also boost the Australian dollar. If the Consumer Price Index is higher than expected, traders may abandon their current bets on the Reserve Bank of Australia cutting rates more than twice this year, especially when the central bank has indicated a "cautious and gradual" policy stance. Ray Attrill expects the Australian dollar to rise by nearly 3% by the end of the year.