The Aussie dollar has fallen more than a cent this week, with the sharpest move coming in response to Australia’s Q1 inflation data on Wednesday. The below-consensus inflation reading stoked a fresh wave of pricing for RBA rate cuts. A cash rate cut to 1.25% had only been fully priced... Show More
The Australian dollar has emerged a little stronger after a very busy week. Most of the headlines were positive, with the one real negative coming from the RBA. While there was no surprise in the steady hand on the cash rate at 1.5% or in much of the language of... Show More
The US dollar was stronger against almost all major currencies this week. This was not so much due to positive news on the US economy but instead in response to negative developments elsewhere. The euro for instance tumbled on Germany’s very weak manufacturing survey for March. Show More
The US dollar is lower against most G10 currencies this week, with the British pound’s 2% rally particularly notable. The pound jumped as the UK parliament voted in favour of an amendment that rejects a ‘no-deal’ Brexit under any circumstances. Show More
Months in advance, we could see that this would be a pivotal week for the Australian dollar and interest rates, as was early February. A month ago, the focus was on the RBA’s lower growth forecasts and its shift in underlying policy bias from an eventual hike to risks on... Show More
The Aussie dollar is about flat over the week, around 71 US cents, but it has been very volatile. Australia’s key data releases on wages and employment were quite encouraging, but the Aussie was then hit by Westpac’s new forecast for the RBA cash rate and worries over China’s coal... Show More
A week ago the US dollar was under pressure after the Federal Reserve indicated at least an extended pause in its tightening cycle. We expected this dovish turn from the Fed would undermine the US dollar for some time. Instead, the dollar is up against all G10 currencies this week,... Show More
The A$ was among the best performing G10 currencies this week. My colleague David discusses how the Aussie was buoyed by the market’s dovish interpretation of the Federal Reserve as well as a strong rally in iron ore prices. Next week’s Australian calendar is very crowded with the release of... Show More
The A$ has had a bad week. Since we are looking for a soft reading on Australia Q4 CPI on Wed, RBA rate cut talk is likely to linger near term. So in order to recover some lost ground, the Aussie is probably going to need a breakthrough in the... Show More
It has certainly been a volatile week, with an overload of information both locally and globally for markets to digest. Markets remained in a risk-averse mood, and equities have fallen sharply. The Aussie dollar has also underperformed, being the weakest G10 currency this week. Show More
Hi James, appreciate the kind words. To contact Bill or his team, please email email@example.com
Malcolm, our Economics team does the longer term forecasts. In his monthly commentary on A$, Bill Evans wrote, ""We confirm our target for AUD to head to USD 0.70 through 2019."" His writeup is on p4 here: https://westpaciq.westpac.com.au/wibiqauthoring/_uploads/file/Australia/2018/August/WestpacMarketOutlookAugust2018.pdf
Peter, Westpac's year-end AUD forecast in the Feb 2018 monthly report was 0.72. End-Sep forecast was 0.74. And yes, they are sometimes revised! Commodity prices are indeed under pressure this week though our daily index is still in about the middle of the range of the past 5 years. I agree we need to watch the yuan but the PBoC has $3 trillion of FX reserves to ensure it doesn't fall too fast.
Good pickup, Jay, the labels aren't visible - the red line is 60 day correlation, the grey line is 30 day. I am using MSCI World Index in US$ terms so there's plenty of scope for the daily % changes in the 2 series to diverge but lately the relationship has tightened, even though AUD/USD had been range-bound until last week.
James, our longer term forecasts are only reviewed monthly so no change right now. In the weekly FX video we usually focus on the short term outlook. Spot iron ore has risen solidly past two days - glimmer of hope for AUD??!