The AUD has been under pressure, mainly due to a more dovish RBA monetary policy stance. Although the central bank kept interest rates unchanged, it was stressed that a lower exchange rate is likely to be needed to achieve balanced growth in the economy.
This implies that the RBA may consider lower rates in order to ease monetary conditions, should the currency fail to depreciate more considerably.
All of the above suggests too, that the AUD is unlikely becoming more sensitive to improving global risk sentiment.
Accordingly we expect the AUD to remain subject to downside risk, in particular against the USD.
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