AUD/USD expected to drop towards 0.68 in 12-m – Danske Bank

By FXStreet FXStreet (Edinburgh) – Analyst at Danske Bank Kristoffer Lomholt expects the Aussie to depreciate towards the 0.68 handle vs. the greenback in a year’s view.

Key Quotes

“Until recently, the AUD held up remarkably well despite the re-collapse of global commodity prices. For instance, while the RBA commodity index fell by 4% from September to November, the trade-weighted AUD actually rose”.

“Together with the recent developments in global commodity prices, this has increased the probability of an RBA rate cut and markets are pricing in roughly 50% probability of a rate cut in the next 6M”.

“For now, we stick to our long-held view of an unchanged monetary policy rate over the next 12M, which should limit downside risk for the cross”.

“We roll our forecast for AUD/USD to 0.69 in 1M (from 0.70) but leave our 3M, 6M and 12M forecasts unchanged at 0.69, 0.68 and 0.68, respectively”.
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Source:: FX Street