FXstreet.com (San Francisco) - According to Capital Economics, the Australian dollar is set to come under further pressure.
CE explains that not only is the recent AUD weakness attributed to the prospect of looser monetary policy, but also to investor’s appetite for risk “which is reflected in the decline in the prices of many commodities since the Fed launched QE3,” CE explains.
“We expect the exchange rate to fall just below parity by the end of this year and creep back up to this level towards the end of our forecast window in 2014,” says Capital Economics in a research note.
At the time of writing, AUD/USD exchanges 1.0260 vs. 1.0361 late Monday.
CE explains that not only is the recent AUD weakness attributed to the prospect of looser monetary policy, but also to investor’s appetite for risk “which is reflected in the decline in the prices of many commodities since the Fed launched QE3,” CE explains.
“We expect the exchange rate to fall just below parity by the end of this year and creep back up to this level towards the end of our forecast window in 2014,” says Capital Economics in a research note.
At the time of writing, AUD/USD exchanges 1.0260 vs. 1.0361 late Monday.
