AUD/USD: Still see a tendency to weaken next year – Danske Bank

According to the Danske Bank, the AUD has on a rising trend before a more hawkish-than-expected Fed turned the tide in December.

Key Quotes

“AUD strength has been supported by higher commodity prices and positive data surprises from China, but we still see a tendency for AUD to weaken next year as monetary policies diverge and the Chinese recovery loses momentum. We expect broad based USD strength to dominate FX markets in H1 and we have lowered our AUD/USD forecasts for 0.73 in 1M and 0.72 in 3M before a stabilisation. Our 6M and 12M forecasts are 0.73 and 0.73, respectively.”