12 Nov 2013
Flash: AUD/USD bear trend could extend for some time - RBS
FXstreet.com (Barcelona) - While recently bullish AUD, Greg Gibbs, FX Strategist at RBS, has now turned bearish on the pair following the sharp drop after the US payrolls report last week.
Key Quotes
"The ongoing relative strength in the US equity market, weaker outlook in Europe and considerable fear that China is about to kill its growth again are significant testing my view on the USD and leaving me in a quandary."
"The Australian economic data has significant picked up since earlier in the year. However, the RBA has ramped up its rhetoric
against the AUD in recent weeks. Perhaps because it feared a rebound after the Fed delayed taper. The RBA’s more dovish tilt in the face of stronger domestic and global indicators has also helped create a weaker AUD."
"The market is taking on a more bullish tilt for the USD and a bearish tilt for the AUD. It could extend for some time, even though it is not really backed by recent underlying growth trends or interest rate expectations."
"On the back of the rebound in the AUD in most of October, Australian business confidence fell from +12 to +5. This still leaves it above levels seen since early 2011, apart from the Sep reading which was the high since 2010. The data is contributing to a weaker AUD on Tuesday along with the report in the FT that argues China’s reform process will slow growth next year and the government may accept a lower base for growth of 7%."
Key Quotes
"The ongoing relative strength in the US equity market, weaker outlook in Europe and considerable fear that China is about to kill its growth again are significant testing my view on the USD and leaving me in a quandary."
"The Australian economic data has significant picked up since earlier in the year. However, the RBA has ramped up its rhetoric
against the AUD in recent weeks. Perhaps because it feared a rebound after the Fed delayed taper. The RBA’s more dovish tilt in the face of stronger domestic and global indicators has also helped create a weaker AUD."
"The market is taking on a more bullish tilt for the USD and a bearish tilt for the AUD. It could extend for some time, even though it is not really backed by recent underlying growth trends or interest rate expectations."
"On the back of the rebound in the AUD in most of October, Australian business confidence fell from +12 to +5. This still leaves it above levels seen since early 2011, apart from the Sep reading which was the high since 2010. The data is contributing to a weaker AUD on Tuesday along with the report in the FT that argues China’s reform process will slow growth next year and the government may accept a lower base for growth of 7%."