The AUD/USD pair continued to decline in September. CIBC Capital Markets economists analyze the pair’s prospects.
AUD weakens
We have revised down our AUD/USD forecast for the fourth quarter of 2023 to 0.62, as we expect the strength of the Dollar to persist until the end of the year. Global growth headwinds are likely to continue weighing on the AUD as European growth stalls and the Chinese economy remains weak. So, it is not until the second quarter of 2024 that we expect AUD/USD to begin a recovery.
We expect the pair to reach 0.68 in the fourth quarter of 2024.
We also expect the RBA to raise rates again in November. While a rate hike should generate some short-term gains in the AUD, we expect a stronger Dollar and slowing global growth to dominate AUD/USD moves.
Source: Fx Street
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