It’s hard to digest that its nearly August and harder still to fathom that Christmas is only 4 and half months away.
2016 has already been a dramatic year for markets as a fear mongering campaign from Drumpf and the recent turmoil surrounding Brexit create market uncertainty. For the Aussie dollar that’s meant wild swings and likely a similar scenario for the remainder of the year.
In total the Aussie dollar has changed direction dramatically on 5 occasions with a trading range between 0.6820 seen in January and 0.7835 seen in April. Current forecasts range from 0.5000 to 0.7500 depending on where you look. Major drivers remain the same and that is the interest rate differential between the U.S and Australia, which as it stands is 0.5% vs. 1.75%. If we see a surprise cut from the RBA and a surprise rate rise from the U.S Federal Reserve before year end then that erase the carry trade and sow the seeds for AUD/USD below 0.7000, but at this stage that scenario remains unlikely, but still a possibility. Let’s keep an eye on markets!
DATA RELEASES TODAY:
EUR – German IFO Business Climate at 6.00pm
AUD EXCHANGE RATES:
AUD/USD – 0.7467
AUD/GBP – 0.5683
AUD/EUR – 0.6807
AUD/NZD – 1.0666
AUD/JPY – 79.369
***Above rates are indiciative wholesale rates and intended as a quide only***
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Senior Corporate FX Dealer
Contact Patrick for a quote on 0431 278 632