AUD/USD Monthly Fundamental Forecast September 2013 The AUD/USD is very weak trading at 0.8904. The tumble stated after the RBA reduced rates and the was compounded by a month of lackluster data. This was compounded by the rising in risk off trading as the Syrian conflict took center stage. Australia will be another major focal point for the region’s markets. Second quarter GDP figures are expected to grow by 2.6% q/q at an annualized rate. That would come close to matching the performance of countries like the UK, US, and Germany. If correct, then the second quarter of growth in this range might suggest that the slowdown is bottoming. At risk is that the data is stale and lags behind negative developments across Asian markets in Q2 coupled with global rate pressures. The RBA will have an advance handle on this release that occurs following its policy decision that same day and that is not expected to result in a rate change. The prior day’s retail sales figures may also inform the RBA’s decision, but it will be taken in the context of the soft trend since March over which sales have been largely flat. Highest: 0.9233 Lowest: 0.8848 Difference: 0.0385 Average: 0.9036 Change %: -0.38 The AUD reached its monthly low in early August and subsequently stabilized as the market’s focus shifted to the emerging markets. The Reserve Bank of Australia continues to highlight the importance of the FX rate in monetary policy while investors have maintained a large short AUD position. Traders can expect the AUD to bottom in Q3, subsequently stabilizing in Q4 at a level that allows the central bank to maintain current policy rates.
Posted on: Sun, 01 Sep 2013 14:53:00 +0000