Jane Foley, Senior FX Strategist at Rabobank, thinks that the AUD/USD pair could drop toward 0.7200 by the top of the year.
“Over the approaching year approximately , developments within the Australian labour market and especially wage data are going to be instrumental in guiding expectations regarding RBA policy.”
“In this time-frame, it’s likely that the market are going to be expecting any longer changes potentially on the Bank’s QE policy
or on the guidance with reference to the Cash rate, which the RBA doesn’t expect to regulate until 2024.”
“The impact of any changes on AUD/USD will depend upon the expected path of policy from the Federal Reserve System . Assuming the RBA is seen as a laggard on policy, it’s reasonable to assume that AUD/USD could track lower. Consequently, we’ve adjusted down our AUD/USD forecasts. We now see scope for the currency pair to edge towards 0.72 by year-end.”