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Despite the RBA delivering a rate cut that was only priced as a low probability a week ago, AUD/USD has been resilient, trading around 0.66. Squeezes will offer better opportunities to sell, strategists at Westpac Institutional Bank advise. 

Key quotes

“AUD/USD resilience is due to the USD’s lurch lower, with JPY, EUR and CHF posting much larger gains as US yields tumbled.”

“The global mood swing against the US dollar is likely to extend near term, but the broader picture remains bearish for AUD crosses.”

“We look for a further cut to the 0.25% lower bound in April by the RBA, then the debate turns to QE.” 

“Look for choppy trade either side of 0.6600 near term, with squeezes offering opportunities for better levels to sell. Sub-0.64 still a reasonable multi-week target.”