According to analysts at Nordea Markets, it is still too early to expect a further rebound in the AUD (technically, an AUD/USD short looks compelling from just below 0.73).
Key Quotes
“The AUD has been a lagged “slave” of the fortunes of the Asian currencies for a while and while both AUD and NZD could prove to be solid bets versus the USD in case the wobblier Fed comments continue, we choose to bet on further AUD downside versus NZD.”
“Even in a reflationary comeback scenario, driven by a widespread undermined USD, we argue that NZD will outpace AUD due to squaring of the current positioning (NZD more hated than AUD by spec-accounts).”
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