AUD: Scope to extend recent gains to the EUR 0.6350/0.6400 - Westpac

Sean Callow, analyst at Westpac, suggests that they see scope for AUD to extend recent gains to the EUR 0.6350/0.6400 or AUD 1.5625/1.5750 area multi-week.

Key Quotes

“AUD has made modest gains against the euro in recent weeks, broadly correlating with improved global risk sentiment as the FOMC hit pause in its tightening cycle.”

“Interest rate markets’ moves to price in RBA easing in response to Australia’s cooler growth outlook have had limited impact against the euro, given the protracted Eurozone growth slowdown.”

“Still, AUD seems to have more upside potential multi-week, with a US-China trade deal of some description likely, commodity prices supportive and Australian data more likely to cool than to inflame RBA rate cut pricing.”