AUD/USD expected to edge higher – Westpac

In opinion of Strategist at Westpac Robert Rennie, the Aussie dollar is seen gathering further traction following a ‘Remain’ win in the UK Referendum.

Key Quotes

“Base case for us is a modest Remain victory and thus AUD is set to continue pushing higher. No bias from the RBA, limited risks of a near term Fed hike, modestly rising commodity prices and waning risk aversion all favour the upside as the path of least resistance too”.

“However, we would caution against too much optimism beyond that point. The federal election has not been a focal point to date. However, with Brexit worries set to fade, it could become a factor that holds optimism back. We may also get post budget and election guidance from ratings agencies after the election plus the release of Q2 CPI late in the month ahead of the August RBA meeting”.

“Given the above, we maintain a mild positive bias for the A$ for the week ahead”.