The Australian dollar steadied around $0.71, holding recent losses as investors weighed stronger-than-expected GDP figures that strengthened the case for another interest rate hike. The economy expanded 0.4% quarter-on-quarter in Q2, beating forecasts for 0.3% growth, while annual growth accelerated to 2.1%, above expectations for 1.8%. The stronger reading suggested economic activity remains resilient despite the Reserve Bank's efforts to cool demand and curb persistent inflation. Markets raised the odds of a fourth rate hike at the September meeting to 57% from 48% previously after the GDP release, while a November hike is now more than fully priced in. The probability of another hike in Q1 2027 also rose to 82% from 62%. Meanwhile, concerns over potential oil supply disruptions amid the escalating US-Iran conflict have pushed energy prices higher, adding to inflation pressures. However, a stronger US dollar capped the Aussie as rising yields boosted demand for safe-haven currencies.