This via the folks at eFX.
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Morgan Stanley Research maintains a bearish bias on AUD, expressing this view via a short AUD/NZD exposure in spot.
- "We believe the RBA's pivot earlier this month signals a fundamental shift from that central bank which will weigh further on both AUD/USD and AUD/NZD," MS notes.
- "While the RBA had signaled that its hikes would slow as rates rose, the lack of significant new data between the September and October meetings suggested that the RBA may be increasingly cautious about the regional growth outlook. As Chinese and regional growth slow (in line with our China economists' expectations) we expect further divergence between the RBA and RBNZ, sending AUD/NZD lower towards 1.07," MS adds.
AUD benefitted from the risk on mood Friday, ICYMI: