This via WPAC on the Australian dollar, retaining their 0.68 in September view.
- Having tumbled from 0.7200 mid-April to the high 0.68s mid-May as soft Australian data and RBA rhetoric pointed to a minimum of 2 cash rate cuts, AUD/USD price action has been a lot more mixed in recent weeks.
- 5 year highs on iron ore prices have provided some light amid gloom for other key commodities and record short A$ positions by real money accounts in futures markets suggest plenty of bad news priced in.
- Increased pricing for Fed easing in response to US trade battles with China, Mexico et al also limits AUD/USD downside. We expect rallies to remain modest and some trade with a 0.67 handle would not surprise, but we retain our 0.68 end-Sep forecast.
(update dated June 17)
