The Australian dollar is making fresh highs on the day, week, month, year ... even as we approach the Reserve Bank of Australia announcement
This via Société Générale, they are a little wary of the ability for the AUD to gain over the RBA today ...
- CFTC positioning data ... a persistently big short in JPY, and the continued build-up of longs in AUD, CAD and NZD
- We like AUD and CAD longs against JPY and USD and the positioning data don't do a lot to fill us with encouragement
- The combined AUD, NZD and CAD long hasn't been this big since AUD and CAD were worth more than a dollar each
- Markets, as eager to jump on a new trend as teenagers, have been enthusiastic buyers of the idea that the Fed is old hat in the tightening cycle and the fun comes from BOC/RBA/RBNZ. It's better to be too early than too late, but the RBA this week and the RBNZ next week will both make us wait and no-one much wants a stronger currency so the longs are going to struggle for good news, other than the ongoing sogginess of US bond yields, and the revival in commodity prices
- Which is another way of saying we'll be happy if we find AUD and CAD at these levels in a week's time
- Especially if they're here against not just the USD but also against SGD and JPY
- The RBA meets ... and the RBNZ meets next week. Neither will adjust rates, but maybe the RBA's economic assessment will provide enough support to the market to prevent a correction.
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Previews I posted earlier:
- HSBC on the AUD risk over today's RBA announcement - how it "could fall sharply"
- Trading the RBA announcement due today - preview (infographic style!)
- The RBA Could Talk-Down AUD At Its August Statement - NAB
- AUD traders note, the RBA meet Tuesday. Here are a couple of quickie previews
- AUD - RBA preview. SOMP follows on Friday - preview also
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AUD today:
