Forex Flash: AUD below par later this year - RBS

FXstreet.com (Barcelona) - “The AUD is caught somewhere between a safe haven and a high beta currency,” says Greg Gibbs, FX Trading Strategist at RBS, while AUD/USD is last at 1.0426, slightly lower for the session on Chinese share markets weakness. “Stress in Europe could weaken or strengthen the AUD, depending on how much contagion there is to global markets and commodities,” Greg adds, though “The AUD TWI shot to a new high yesterday,” he notes.

“But we continue to see a peaking in the resources sector, slower growth in China and the risk that commodity prices fall further later this year,” the analyst expands, adding: “And thus we still see AUD below par later this year. The prospect of China clamping down on its shadow banking system may be a good thing over the medium term but it in creases downside risks in the near term in China,” Mr Gibbs concludes.