AUD vs EUR: Expect Aussie outperformance near term - Westpac

Sean Callow, Research Analyst at Westpac, suggests that with global yields under renewed pressure and the RBA on hold, AUD should outperform the euro, most likely extending to AUD/EUR 0.70 or EUR/AUD 1.43 over the next 4-6 weeks.

Key Quotes

“Beyond mid-Sep though, AUD seems likely to falter, with commodity prices likely to roll over on ample supply and patchy demand, while the debate over a Fed rate hike (most likely Dec) should inject volatility into post-northern summer markets. Hence this bout of AUD strength should be seen as a selling opportunity (EUR buying), with our year-end forecast AUD/EUR 0.66, EUR/AUD 1.5150.”