AUD/USD Fundamental Forecast – August 24, 2016

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Published: Aug 23, 2016, 03:46 UTC

The AUD/USD added 16 points to trade at 0.7636 as the US dollar dipped to 94.43. Commodity currencies all showed gains across the board. As was the case

AUD/USD Fundamental Forecast – August 24, 2016

The AUD/USD added 16 points to trade at 0.7636 as the US dollar dipped to 94.43. Commodity currencies all showed gains across the board. As was the case on Monday, there is absolutely nothing on the domestic data docket that appears likely to sway the Aussie one way or another. Commonwealth Bank of Australia chief currency strategist Richard Grace said the Australian dollar put on a mix performance against the other major crosses in what was a very light offshore economic data calendar.

Business Insider reported that as opposed to its previous expectation that the Aussie would bottom out at 69 cents in mid-2017, the bank now sees the Aussie hitting a cyclical low of 68 cents by the middle of 2018.

Higher for longer, albeit eventually lower, in a nutshell.

“With no further RBA cuts expected this year, the AUD now looks unlikely to fall much if at all before late 2016 and assuming the Fed moves in December as NAB expects,” wrote Ray Attrill, co-head of FX strategy at the NAB. “We still project a significant fall in 2017, aided by further RBA easing, falls in Australia’s terms of trade and a modestly stronger US dollar.”

Financial markets do not fully price a 0.25% rate hike being delivered in the US until the September quarter next year.

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August 24, 2016

Country	Name	Volatility	Previous
NZD	Trade Balance (MoM)	2	127
NZD	Trade Balance (YoY)	2	-3.31
NZD	Exports	2	4.26
NZD	Imports	2	4.13
CHF	UBS Consumption Indicator	2	1.34
EUR	GDP w.d.a (YoY)	3	1.8
EUR	GDP s.a (QoQ)	3	0.4
EUR	GDP n.s.a (YoY)	3	3.1
USD	Housing Price Index (MoM)	2	0.2