Morgan Stanley: RBA On Hold; AUD Upside Has Further Room To Run.
We think AUD has further room to appreciate against the USD if risk remains supported as decent data is enough to keep the RBA on hold and investors seeking higher yielding assets. RBA assistant Governor Kent struck an upbeat tone this week and better than expected GDP growth (though with a mixed breakdown) as well as a falling UE rate are good enough to limit the risks of RBA rate cuts, despite a still worrisome inflation outlook. The RBA accord signed by new Gov. Lowe also emphasized their ability to take into account financial stability concerns when making monetary policy. With AUDUSD at 0.77, it still has room to go higher before the RBA becomes too worried about over valuation.
BNPP: RBA On Hold, AUD/USD To Test 0.7750.
The near-term backdrop for commodity exporter currencies remains favourable, with US real rates continuing to decline and oil prices holding near their post-OPEC deal highs. We agree with market consensus that the RBA will leave policy and messaging unchanged in the first meeting under the leadership of new Governor Philip Lowe. AUD can re-test 0.7750 in the near-term.
NAB: RBA On Hold Till Mid-2017.
The RBA is expected to leave rates unchanged tomorrow (and by NAB until mid-2017). The RBA expects that the diminishing drag from the resource sector investment and supportive commodity price should underpin employment and growth. With no change in RBA monetary policy priced in this month, the market will be interested in today’s post-Board Media Release wording on the economy, housing, and the AUD.
Westpac: RBA In Wait And See; AUD Gains S/T Before Correction Lower.
The RBA is widely expected to keep the cash rate on hold at 1.5%; in “wait and see” mode as they assess the impacts of the rate cuts delivered in May and August, totalling 50bps. hile further gains to around 0.77 are possible during the month ahead, driven in part by the faltering US dollar and yield-chasing flows, the AUD is losing energy (perhaps a reflection of its declining yield advantage). By year end, there’s a case for a correction towards 0.74 if the Fed tightens in December as we expect.
BofA Merrill: RBA On Hold, AUD To Be Driven By External Factors.
The RBA inflation regime now places more stress on flexibility. The 3Q CPI data would have to be very weak to prompt a cut. We still expect a cut next year. We are looking at a period of stable policy in Australia as the new RBA Governor Lowe embarks on his 7-year term. In our view, the RBA will be on hold for the rest of this year after cutting the cash rate by 50bpts this year, as it continues to demonstrate a gradual approach to easing and retain policy flexibility to respond to emerging imbalances if required. The US election and commodity prices will be more important for the AUD. The terms of trade look more likely to weaken.
Credit Agricole: Changing Of The Guard; AUD Neutral.
Some of the AUD’s focus will shift back to the RBA this week, but overall risk sentiment and expectations about Fed rate hikes will continue to dominate its trend. It will be the first meeting of the RBA Board under Governor, Philip Lowe, and Deputy Governor, Guy Debelle. But these are the only changes we expect, so we expect the meeting to be neutral for the AUD. The RBA will likely keep rates on hold and continue to indicate a neutral policy bias while forecasting inflation to remain low for ‘some time’, which means it could cut rates if it needed to thought. The RBA will also likely continue to speak softly about the currency. Lowe recently said that the RBA are not “inflation nutters” and the newly signed Statement on the Conduct of Monetary Policy emphasized the flexible nature of the 2-3% inflation target and that it should be pursued in the context of financial stability. So the RBA is not likely to go slashing rates in a rush to get inflation (currently running at 1.5% YoY in underlying terms) back into the target band. And while the RBA will continue to say that its indicators show that the housing market is cooling, it will remain wary of re-stoking the flames underneath the market by cutting rates further.
Barclays: RBA Comfortably On Hold
We see the RBA comfortably on hold on Tuesday, as it awaits Q3 CPI data for further guidance. The September RBA Board minutes suggest that the board is content with its current policy stance, as economic growth remains close to potential. With the easing delivered in May and August, the RBA believes that policy conditions were still consistent with achieving its inflation target over time, amid sustainable growth conditions.
Copyright © 2016 eFXplus™
The article is published by one of the foremost sources of Forex trading information. Link to the original article above.
from eFXNews http://feedproxy.google.com/~r/Efxnews/~3/3s7ovx4EVCw/trading-rba-views-7-major-banks
from Online Forex Trading Resource http://its-veso.tumblr.com/post/151317268617
No comments:
Post a Comment