The AUD/USD rally from late 2023 has moderated modestly into early 2024. Economists at Danske Bank analyze the pair's outlook.
AUD/USD remains firmly in the hands of global risk sentiment
With Australian indicators pointing firmly to the downside, and US economic data still strong, we expect relative rates and growth to weigh on AUD/USD going forward.
AUD/USD remains firmly in the grip of global risk sentiment, where the outlook for inflation and rate cuts remains a key factor.
Overall, we think the Fed will opt for a more gradual pace of rate cuts, which will be a supportive factor for the broad USD. We maintain our downward forecast profile unchanged.
AUD/USD Forecast: 0.6600 (1 month), 0.6400 (3 months), 0.6300 (6 months), 0.6200 (12 months)
Source: Fx Street
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