Credit Agricole CIB FX Strategy Research notes that AUD/USD has reached levels that are looking excessive relative to the Australian-US 2Y rate differential.
As such, CACIB argues that in the near-term, it will be a confidence check for AUD bulls if they manage to keep the currency bid.
“External factors are likely to remain the main driver of the currency with US CPI data being the highlight, with UST yields being particularly important,” CACIB adds.
Turning to CAD, CACIB notes that it has now priced in much of this good domestic economic news as well as the low volatility environment globally.
“While the long term trade in CAD is positive the near-term outlook is vulnerable to slowing in domestic data (in reaction to a tightening in financial conditions) and less buoyant risk sentiment globally,” CACIB argues.
Source: Credit Agricole CIB Research
The article is published by one of the foremost sources of Forex trading information. Link to the original article above.
from Online Forex Trading Resource
View thesource article here