FXstreet.com (London) - Stephen Gallo, European Head of FX Strategy at BMO financial Group sees support for AUD.

Key Quotes:

“…we think the AUD should find some support in the run-up to the August RBA decision, given the pro-stimulus comments which now seem to be emanating from China”.

“Although the level of the AUD appears to be positively correlated over time with the degree of tightness of Chinese fiscal and monetary policies, since 2008 the percentage change in the AUD has tended to be positive once looser fiscal policy and rate cuts have been delivered”.

“Given the degree to which the AUD has already fallen, unexpectedly aggressive easing from Chinese authorities could give AUD/USD a modest boost as they come through”.