30 Apr 2015
What will drive the Aussie? - Westpac
FXStreet (Guatemala) - When asking themselves the question, "In a world of super low rates, is the A$ yield or commodity driven?", analysts at Westpac Banking corporation explained that they find compelling evidence to suggest that yield, issuance and demand factors are increasingly important drivers for the A$.
Key Quotes:
"As we have argued many times before, the obvious conclusion we come to is that the A$ is likely to remain very sticky as we approach the 0.73/0.75 level."
"We think yield related demand is set to remain a more important driver for the A$. Certainly more so than traditional fair value frameworks would suggest."
"As the interest rate differential drops further, so will yield, issuance and demand for the A$. Thus we continue to forecast further weakness in the A$ as the year progresses."
Key Quotes:
"As we have argued many times before, the obvious conclusion we come to is that the A$ is likely to remain very sticky as we approach the 0.73/0.75 level."
"We think yield related demand is set to remain a more important driver for the A$. Certainly more so than traditional fair value frameworks would suggest."
"As the interest rate differential drops further, so will yield, issuance and demand for the A$. Thus we continue to forecast further weakness in the A$ as the year progresses."