AUD: Substantial surprise for domestic news to be a major driver - Westpac

Sean Callow, Research Analyst at Westpac, suggests that Australia’s busy calendar gives us plenty to watch each day but they would need a substantial surprise for domestic news to be a major driver of AUD.

Key Quotes

“The RBA made very clear last month that the cash rate was very unlikely to be moved for some time. That limits the impact of the data and RBA commentary.”

“However, AUD could be jittery around the GDP data, since it often surprises and is shaping up as a fairly soft 0.5% rise. Net exports look to be especially weak though 2018 looks more promising.”

“So, the USD mood should be key for AUD/USD near term. If the post-Powell recovery extends as we expect then the pair should probe 0.7650 or below. Limiting downside on AUD crosses though is the resilience of commodity prices since the lunar new year.”