Philip Moffitt, head of fixed income for the Asia-Pacific region at Goldman Sachs Asset Management, speaking at the Bloomberg Summit in Sydney (earlier headline here). More now:
- Sees the Federal Reserve tightening early next year and says the U.S. economy is in great shape
- Sees Australian dollar about 85 U.S. cents in 6 months because “the dollar’s going to be strong in the early stage of this tightening cycle”
- Additional RBA rate cut still possible next year if currency remains around 85 cent level
- There has been strong portfolio demand for Australian dollar assets
- Says there’s more complexity to FX levels than just relative moves in rates
- The process of opening up China’s financial markets has accelerated and the opportunity for foreign investors to invest directly there is picking up
- The longer-term idea of Aussie as a proxy for China “is definitely going to wane as a direct driver of the currency”
