In the near-term, the RBA’s QE policy, the Victoria lockdown and issues related to trade with China are still good reasons to expect AUD/USD to remain capped, according to Jane Foley, Senior FX Strategist at Rabobank. In addition, the aussie could dip towards 0.76 on a strong NFP report.
USD could rise further, the ripples of NFP have the potential to stretch far and wide
“At the policy meeting in July, the Reserve Bank of Australia will be weighing up the improvement in the domestic economic data against factors such as the latest Victoria lockdown, the potential for further outbreaks of covid, trade tensions with China and the risks to the exchange rate from being labelled a hawkish central bank.”
“As long as the RBA is concerned about low inflation, it is unlikely to welcome a stronger AUD. This is a good reason to anticipate that the RBA will be keen to continue being perceived as a dovish central bank.”
“Any additional broad based USD strength following the May Nonfarm payrolls report could push AUD/USD towards technical support in the 0.7600 area.”
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.