Back
2 Aug 2013
Flash: AUD/USD stability hinges on 0.8860-0.8900 supports – Westpac
FXstreet.com (New York) - Given Governor Stevens has made a point of encouraging fresh AUD selling, it is hard to see the Aussie emerging stronger out of the RBA’s likely rate cut, suggests Sean Callow, a Global FX Strategist at Westpac.
Key quotes
“Domestic data should be no better than mixed, leaving markets pondering just how low the cash rate will fall and thus inclined to sell into AUD rallies for now. However this is a clearer story for AUD crosses than for AUD/USD.”
“Specs remain heavily short the pair so any soft US data e.g. lukewarm payrolls growth or low core PCE deflator would rattle those positioned long USD in anticipation of a Sep Fed tapering kickoff.”
“It is hard to be too upbeat on AUD/USD but we opt for neutral on the week given the USD dynamics. A break of 0.8860/0.8900 would be very messy but so long as it holds, 0.89-0.9120/30 should capture most trade.”
Key quotes
“Domestic data should be no better than mixed, leaving markets pondering just how low the cash rate will fall and thus inclined to sell into AUD rallies for now. However this is a clearer story for AUD crosses than for AUD/USD.”
“Specs remain heavily short the pair so any soft US data e.g. lukewarm payrolls growth or low core PCE deflator would rattle those positioned long USD in anticipation of a Sep Fed tapering kickoff.”
“It is hard to be too upbeat on AUD/USD but we opt for neutral on the week given the USD dynamics. A break of 0.8860/0.8900 would be very messy but so long as it holds, 0.89-0.9120/30 should capture most trade.”