AUD/USD has reversed the move – Danske Bank
|Minna Kuusisto, Analyst at Danske Bank, explains that AUD/USD has reversed the move after the US elections which pushed the pair as low as below 0.72 around year-end as the lack of details of the US administration’s economic plans weighed on USD and supported AUD January-February.
Key Quotes
“Furthermore, improvement in Australian economic data together with a more optimistic tone from the central bank have helped AUD to return to pre-Trump-win levels. We recognise the support for AUD from improved global economic conditions and rising commodity prices. However, we still think that the RBA wants to limit the upside in AUD and is ready to soften its tone in case the exchange rate appreciates excessively. Also, we see relative monetary policies supporting USD versus AUD this year.”
“We keep our forecast unchanged, expecting weakness on a 1-6M horizon (as the US administration reveals more details of its economic plan) and longer-term stabilisation in AUD. Our 1M forecast is 0.75, 3M forecast 0.73 and 6-12M forecasts 0.74 and 0.75 respectively.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.