11 Oct 2013
Flash: AUD/USD may garner a fresh wave of buying - TDS
FXstreet.com (Barcelona) - The AUD has held up quite well, with Annette Beacher, FX Strategist at TDS, suspecting "a lot of this support is due to the AUD still being seen as a safer, AAA-rated high-yielding haven, with some bigger offshore investors apparently buying on dips over the past couple of weeks, capping the downside."
Other Key Quotes
"One source of potential near-term upside for the AUD is the net spec community scaling back longstanding AUD shorts. Another source of upside is the increasing crescendo of market chatter that the next move is up for the RBA cash rate."
"We were of the view that the RBA could talk down the lofty AUD, but after consecutive neutral Board meeting communiqués, we are no longer of that view. In fact, many local analysts have dropped their expectations for a November cut over the past week."
"Taking a step further, the OIS/IB strip this week has all-but priced out the risk of another cash rate cut, and indeed is now fully priced for a 25bp rate hike by end-2014. We believe the AUD subsequently may garner a fresh wave of buying in anticipation of the RBA lifting the cash rate well ahead of the U.S. Federal Reserve."
Other Key Quotes
"One source of potential near-term upside for the AUD is the net spec community scaling back longstanding AUD shorts. Another source of upside is the increasing crescendo of market chatter that the next move is up for the RBA cash rate."
"We were of the view that the RBA could talk down the lofty AUD, but after consecutive neutral Board meeting communiqués, we are no longer of that view. In fact, many local analysts have dropped their expectations for a November cut over the past week."
"Taking a step further, the OIS/IB strip this week has all-but priced out the risk of another cash rate cut, and indeed is now fully priced for a 25bp rate hike by end-2014. We believe the AUD subsequently may garner a fresh wave of buying in anticipation of the RBA lifting the cash rate well ahead of the U.S. Federal Reserve."