Commonwealth Bank of Australia on the Australian dollar, looking for it higher in the coming months, citing:
- Commodity prices - rising momentum in the global economy is a positive for AUD/USD because it's linked to global growth expectations and commodity prices .
- interest-rate differentials - risks are tilting to the RBA beginning a tightening cycle before the central bank's current guidance of 2024.
to drive it back higher.
CBA says there is a current lag in fundamentals due to US economic outperformance, and delayed vaccinations in Europe, Japan and Australia. The
CBA do add that the risk to this view is a stronger-than-expected US recovery, and ab associated further material increase in 10-year UST yields
CBA nominates AUD/USD fair value range 0.78 to 0.89.
