US policy a "source of menace" for the AUD - ING

Joshua Gibson FXStreet

ING analysts are out with their thoughts on the risks posed to the Aussie as markets head further into the week.

Key quotes

"While a soft Australian jobs release has dented the Australian dollar, the real source of menace remains US policy.

On the monetary side, higher short-term US rates continue to weigh on high-beta commodity currencies.

On the trade side, the follow-through of US tariffs on Chinese imports is a particular blow for the trade-sensitive AUD.

In a quiet week for global markets, we suspect the latter will be the prevailing narrative - and this doesn't strike us a particularly conducive risk-taking backdrop.

The June RBA minutes (Tuesday) - as well as Governor Philip Lowe's participation at the ECB's Sintra conference (Wednesday) - are likely to be non-events for the AUD.
Look for the pair to remain contained in the 0.7400-0.7600 range in the absence of any further directional catalysts."

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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