Week ahead for AUD - likely to remain caught in the cross-fire of US trade policy

A quick view on the Australian dollar via ANZ (FX strategy for the week ahead)

The AUD is likely to remain caught in the cross-fire of US trade policy for now. We would be less bearish on the outlook if there were strong domestic data to latch onto, but the data flow remains uninspiring from an RBA rate hike perspective. Risks around the housing market may also weigh. Favourable terms-of-trade have helped so far, but this channel seems to be steadying. We expect the AUD to continue to trade defensively.

While that is the week ahead, for the month ahead ANZ's view is 'bearish'.

The bank says fair value for AUD/USD is 0.74