From Barclays latest on Asian Pacific currencies, this in the Australian dollar, their 3 month directional view on AUD is neutral:
Citing:
escalating trade protectionism is a risk to AUD due to the country's large exports to China
the global backdrop should remain generally supportive of growth-sensitive currencies.
there is little reason to expect AUDUSD appreciation given
- Australia's late-cycle position,
- a continued lack of inflation pressure
- and a neutral RBA stance.
The AUD remains overvalued (about 6% above its long-term REER average) and US-Australia interest rate differentials (currently almost +50bp) are likely to widen materially over the coming year as the Fed tightens 100bp and forecasts a median fed funds rate of 3.4% for end-2020, much higher than market pricing of 2.5% in March 2020.
(bolding mine ... that US/Aus interest rate differential widening is widely expected and will weigh on AUD/USD ... but as I have been noting this is a consensus view and the AUD decline will be cushioned by short positioning)
