Why the $A will see at least some support
Why the $A will see at least some support. It is more beneficial to look at the strength of the US$ against all currencies rather than the weakness of the $A individually. The US$ began its strong rally against its trade weighted index (a broad basket of currencies) back in June as talk of an earlier than expected increase in US interest rates spiked interest in the currency. The falling iron ore price did not help the $A, but in the cross rate markets the $A falls have been far more benign. While the $A is beholden to international trends - most particularly the stance of US interest rates - and therefore we are generally expecting the $A to retain its downward trend, there is one significant factor supporting the $A: the search for yield. Click here for the 5-year forecast from Head of Income & Fixed Interest Vimal Gor (VIEW LINK)
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