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17 Jun 2013
Flash: AUD/USD could face bounce back towards 0.9800 – Westpac
FXstreet.com (New York) - While the Fed will be critical in guiding the tapering debate, the China PMI will be important too for the AUD.
According to Global FX Strategist Sean Callow at Westpac, “The recent slump in the AUD/USD looks like it is overdone in the short-term. A bounce back towards 0.98 is possible before selling returns.”
Regarding the AU outright, apart from tomorrow's RBA Minutes, the data horizon is quiet light this week. Therefore expect domestic yields to trade in line with global bonds. In the medium term we remain better buyers on dips – particularly as the market continues to factor in less than two additional RBA cuts - 25bp less than our expectation. Ultimately, “we have a bias towards further curve steepening driven by global steepening, however we advise keeping position size light ahead of the FOMC.” Callow adds.
According to Global FX Strategist Sean Callow at Westpac, “The recent slump in the AUD/USD looks like it is overdone in the short-term. A bounce back towards 0.98 is possible before selling returns.”
Regarding the AU outright, apart from tomorrow's RBA Minutes, the data horizon is quiet light this week. Therefore expect domestic yields to trade in line with global bonds. In the medium term we remain better buyers on dips – particularly as the market continues to factor in less than two additional RBA cuts - 25bp less than our expectation. Ultimately, “we have a bias towards further curve steepening driven by global steepening, however we advise keeping position size light ahead of the FOMC.” Callow adds.