Analysts at MUFG Bank present the idea of a long trade in the AUD/USD pair, with an entry-level at 0.7620, a target at 0.7895 and a stop-loss at 0.7460.
Key Quotes:
“Based on the view that a broader less US-centric optimism over the global recovery is emerging, we see better prospects ahead for the Australian dollar. The better vaccination outlook in Europe and positive growth prospects in China should allow for a slow grind higher for AUD/USD.”
“Jobs data from Australia will be released next week and we see greater upside surprise risks than downside which should help to provide support over the short-term. We have also witnessed strong communication from the Fed over the prospects for continued loose monetary policy. The FOMC minutes indicated that as did comments from a number of Fed speakers.”
“Not until around the end of the year will the Fed have a handle on whether the imminent rise in inflation proves transitory or sustained implying no change in QE tapering at least until then. These consistent messages from the Fed will we believe have an impact on containing yields for a period of time ahead, potentially allowing for some reversal of USD strength, mainly against the higher beta, global growth sensitive currencies like the Australian dollar.”
Share
