24 Jul 2015
AUD/USD risks further downside - ANZ
FXStreet (Mumbai) - FX Strategists at ANZ suggest the near term prospects for the AUD and its cross for the month ahead, after the AUD/USD pair slumped to fresh six-year lows in early Asia.
Key Quotes:
“Following its recent swoon below USD0.75, on some metrics the AUD has started to look closer to fair value. However, this does not yet suggest a base is near.”
“The path of global risk appetite and of global market beta are becoming more important, and the distribution of risk for these factors are lower.”
“Idiosyncratic risks around the AUD are also under-priced and add to downside risks. Given recent spot moves, we tweak our 2015 and H1 2016 AUD forecasts down one cent.”
“The AUD/NZD has rebounded sharply from its lows and is now somewhat better aligned with relative fundamentals.”
“Meanwhile, the AUD/GBP could well continue to move in the other direction. The UK remains on an upward trajectory, and the Bank of England is edging towards a tightening of policy. Should this tightening bias become more overt, then the GBP will perform well on all crosses.”
“Finally, as we saw in the last month, the movement of the AUD against the JPY is likely to depend on the global risk environment.”
Key Quotes:
“Following its recent swoon below USD0.75, on some metrics the AUD has started to look closer to fair value. However, this does not yet suggest a base is near.”
“The path of global risk appetite and of global market beta are becoming more important, and the distribution of risk for these factors are lower.”
“Idiosyncratic risks around the AUD are also under-priced and add to downside risks. Given recent spot moves, we tweak our 2015 and H1 2016 AUD forecasts down one cent.”
“The AUD/NZD has rebounded sharply from its lows and is now somewhat better aligned with relative fundamentals.”
“Meanwhile, the AUD/GBP could well continue to move in the other direction. The UK remains on an upward trajectory, and the Bank of England is edging towards a tightening of policy. Should this tightening bias become more overt, then the GBP will perform well on all crosses.”
“Finally, as we saw in the last month, the movement of the AUD against the JPY is likely to depend on the global risk environment.”