13 Dec 2013
Flash: AUD/USD to remain below 0.90 for the entire 2014 - TDS
FXstreet.com (Bali) - Once December/January distortions in the exchange rate are out of the way, Annette Beacher, FX Strategist at TDS, is forecasting the AUD/USD to sustainably trade below 0.90 for the entire 2014.
Key Quotes
"It is possible that USD0.88 in the first half and USD0.87 in the second half mask a likely much wider trading range of around USD0.85-90."
"However, we cannot in good faith express a base case view of a collapse in the currency (USD0.80 or below) as relatively high AAA-rated yields continue to attract “buy and hold” offshore investors, making the AUD a little sticky."
"We believe relatively new entrants into the AUD market (since 2009 and again earlier this year when IMF officially classified the AUD as a reserve currency) are unlikely to be outright sellers unless there is another global shock to risk (and U.S. tapering is well baked into expectations by now)."
Key Quotes
"It is possible that USD0.88 in the first half and USD0.87 in the second half mask a likely much wider trading range of around USD0.85-90."
"However, we cannot in good faith express a base case view of a collapse in the currency (USD0.80 or below) as relatively high AAA-rated yields continue to attract “buy and hold” offshore investors, making the AUD a little sticky."
"We believe relatively new entrants into the AUD market (since 2009 and again earlier this year when IMF officially classified the AUD as a reserve currency) are unlikely to be outright sellers unless there is another global shock to risk (and U.S. tapering is well baked into expectations by now)."