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AUD/USD could test 0.68 by end of 2015 – Westpac

FXStreet (Edinburgh) - The Aussie dollar could drop towards the 0.68 handle vs. the greenback by year-end, according to strategists at Westpac.

Key Quotes

“It is hard to be too bullish on AUD so long as China’s economy is failing to show a substantive turnaround”.

“The China outlook and our view that markets are underpricing the chances of a Federal Reserve rate hike in Dec leave our end-2015 AUD/USD forecast at 0.68”.

“For now though, Australia’s key commodity prices are not far short of highs since early July despite a step back on Tue”.

“Emerging market currencies posted sharp gains against USD last week, a helpful backdrop for the Aussie as shorts are covered”.

“The domestic calendar is not likely to send AUD heading sharply in either direction, with consumer sentiment potentially supported by the change of prime minister (i.e. factored in already) and Sep labour force data likely to see the unemployment rate hold somewhere near 6%”.

“Another attempt at 0.7380/0.7400 is quite possible during the week. But it is hard to be much more bullish than that”.

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