29 Jan 2014
Flash: AUD/USD: RBA should cap upside potential - UBS
FXstreet.com (Córdoba) - The AUD/USD rose towards 0.8800 helped by domestic data and easing fears in emerging markets. However, according to the UBS analyst team, the RBA stance should cap the upside potential.
Key Quotes
"Australia's business conditions have risen to a 2.5 year high in December. The data is consistent with our view that the Reserve Bank of Australia is unlikely to cut rates further".
"However, we believe the RBA still will call the AUD to be 'uncomfortably high' at its 4 Feb policy meeting, and would like to see 'a lower level of the exchange rate'. This should cap the upside potential for the AUD/USD".
Key Quotes
"Australia's business conditions have risen to a 2.5 year high in December. The data is consistent with our view that the Reserve Bank of Australia is unlikely to cut rates further".
"However, we believe the RBA still will call the AUD to be 'uncomfortably high' at its 4 Feb policy meeting, and would like to see 'a lower level of the exchange rate'. This should cap the upside potential for the AUD/USD".