Currency Analyst since 2010

BarCap: AUD/USD fundamentals

According to analysts at Barclays Capital, the depreciation of Australian dollar is caused by factors that have supported this currency during the recent years:

  1. Higher interest rates (the RBA has been cutting rates and retains easing bias) – Australian yields are no longer that attractive for investors.  
  2. Chinese economic growth declines and so does Chinese demand for Australian exports.
  3. Commodity prices have continued to go down in recent months – another blow to Australia’s exporters.
  4. Demand for Australian debt as a safe haven declined.
  5. Australian monetary authorities clearly expect a weaker national currency and keep saying that AUD rate is about 15-20% overvalued.

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