AUD/USD to hit 0.70 by Q3 2019 - Westpac

Westpac is out with an analyst note highlighting their reasoning for lowering their long-term forecast for the Aussie in 2019.

Key highlights:

• Westpac expects the Aussie to hold near 0.7700 to June before declining to 0.7400 by year-end.
• The previous forecast was for AUD/USD at 0.7600 by June with year-end at 0.7200.
• Forecast revised upwards on expectations of commodity prices keeping the Aussie higher.
• Westpac expects Australian Commodity Price Index to fall around 25% between  June 2018 and December 2019 (in USD terms), after factoring in a 6.5% increase in the Dollar Index.
• Analysts still anticipating an extreme widening of the AUD/USD differential as the Fed raises rates in rapid succession while the Reserve Bank of Australia remains on hold.