Goldman Sachs: AUD likely to rally toward 0.8, that’s when it’s a sell

Philip Moffitt, head of Asia-Pacific fixed interest at Goldman Sachs said in a Bloomberg interview published Monday, the AUD is expected to extend rally towards 0.80 handle, from where selling interest will start building up.

Key Quotes:

"Australia is still offering positive yield and a stable currency”

“That is going to put upward pressure on the Aussie”

“At some point, the RBA will have to cut rates again”

"The currency will get a little bit stronger, but I think the bigger bet for us is to wait to sell it again rather than enter now to get the uptick. The bigger opportunity is for us to wait for it to get to 80"

" ... been quite an increase in conversation around fiscal stimulus and investing in infrastructure and calling it investment rather than borrowing," Moffitt said. "Practically that's what's likely to happen before the RBA cuts again"

"They need even more indication of lower inflation to force them"