Not all doom and gloom for the AUD

Here is Stephen Innes at OANDA on the local currency:

“We’ve had a lot of interest for the Antipodeans after the robust GDP data out of New Zealand.

Given the slow unwind of political risk after Adrian Orr was appointed the new Reserve Bank governor last week, the Kiwi is better positioned to benefit from stronger domestic economic data.and firmer dairy prices

Commodity vs Aussie correlation is leading the charge into year end.

Given what’s expected to be a dovish Fed in 2018 there been far too much energy sapped paying too much attention to the dwindling differential trade as that only comprises one component in the 3 ‘C’s for trading the Aussie (Carry, Commodities and China)

Commodities are ending the year on a strong note with Oil prices firming while Copper is back at the highs for the year.

And while China economy could moderate next year as policies designed to reduce leverage unhurriedly unfold.  And sure deleveraging could lead to a drop in overall domestic investment, prudent monetary policies and greater liberalisation of mainland markets will be viewed favourably by international investors which should keep China’s economic engine well oiled in 2018.”

 

Sydney Morning Herald

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Stephen Innes

Stephen Innes

Head of Trading APAC at OANDA
Stephen has over 25 years of experience in the financial markets and currently based in Singapore as the Head of Trading Asia Pacific with OANDA. Stephen's market views focus on the movement of G-10 and ASEAN Currencies. His views appear in Bloomberg, CNBC.Reuters, New York Times WSJ and the Economist. His media appearances include Bloomberg TV & Radio, BBC International, Sky TV, Channel News Asia, ASTRO AWANI and BFM Malaysia. Stephen has an extensive trading experience in Spot and Forward FX, Currency and Interest Rate Futures, Money Market Derivatives and Precious Metals. Before joining OANDA, he worked with organisations like Nat West, Chemical Bank, Garvin Guy Butler, and Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes