AUD/USD: November’s decline remains in progress, targeting the 0.7170 area – Westpac
|AUD/USD seesaws around 0.7200. A likely extension of broad USD gains near-term suggests a test of 0.7170, perhaps even 0.7106, according to economists at Westpac.
Daily correlation between the AUD and commodity prices has softened
“Most eye-catching is iron ore, up about $15 in 4 days to $103/t as expectations grow for loosening of curbs on China’s property market. While the daily correlation between the aussie and commodity prices has softened over recent weeks, it is a helpful development, especially given the substantial spec short AUD positions on CME.”
“GDP dominates Australia’s data calendar, even though so much has changed since lockdown pummelled Q3. Westpac has raised its forecast to a 2.5% QoQ contraction after resilience in construction and capex. Unusually, GDP precedes the RBA meeting, but it shouldn’t cause a policy reassessment.”
“Likely extension of broad USD gains near-term suggests a test of 0.7170, perhaps even 0.7106 (20 Aug low). But Australia’s rebounding economy should help the pair on crosses near-term and vs USD into year-end.”
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.