1 - 3 month AUD/USD outlook

Westpac on the Australian dollar for the coming quarter

found strength in early September from thawing US-China trade developments

• a bounce in iron ore prices
• and large resource company dividend payments

But 0.6900 did not quite give way before the resources-linked support faded.

• Pressure was amplified by the 12-month high in Australia's unemployment rate, shifting market pricing towards an October RBA rate cut.
• Delivery of this cut and a likely ongoing easing bias should keep a lid on AUD/USD rallies multi-week.
• We also do not expect a major US-China trade breakthrough in October.

an overhang of spec short A$ positioning and our dovish FOMC view should limit the amount of time AUD spends under 0.6700