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2 Apr 2013
Forex Flash: AUD/USD looks to target 1.0400 – Westpac
FXstreet.com (Barcelona) - According to Global FX Strategist Sean Callow at RBS, “The rapid rebuild of spec long AUD positions since early March hints at waning confidence in broad USD measures. Commodity prices remain mostly unhelpful for AUD – local data will need to beat expectations for the AUD/USD to spend much time above 1.0500, with 1.0400 handle more comfortable.”
With regards to the AU outright, the AU rates market were left unchanged, whilst maintaining their easing bias, it was not surprising to see little reaction following no change. This means the recent range-trading environment remains in place. Finally, the AU curve (3-10-year) has been bull flattening on the back of long-end demand for ACGBs, as investors look to enter into AU outperformance trades (mostly relative to US). This has pushed the curve to the bottom of its recent range 50-63bp range, and it is beginning to look attractive for a tactical steepening trade.
With regards to the AU outright, the AU rates market were left unchanged, whilst maintaining their easing bias, it was not surprising to see little reaction following no change. This means the recent range-trading environment remains in place. Finally, the AU curve (3-10-year) has been bull flattening on the back of long-end demand for ACGBs, as investors look to enter into AU outperformance trades (mostly relative to US). This has pushed the curve to the bottom of its recent range 50-63bp range, and it is beginning to look attractive for a tactical steepening trade.