Just a snippet from the CBA morning note on the Australian dollar today
- the Australia-U.S. two-year bond spread has moved back into positive territory
- currently sits at +9bpts
- We anticipate further gains in AUD/USD as market participants assess that a narrow (and at a times negative') Australia-U.S. two-year bond spread is really only a headwind now that Australia's current account deficit has structurally narrowed, and strong global growth lifts commodity prices, and as Australia's economy improves.
- We maintain our 0.7800 year-end forecast
