Your highlights sound like they apply to the US.
I thought maybe I heard rumbles of a Australian tax cut, better domestic spending, and possibly a revival of housing construction. On top of that, I heard some saw the aussie dollar as a play on global growth resumption, being a large resource exporter.
[B] FX ALERT: Goldman Sachs medium term bullish on Aussie dollar
Sydney--1216 JT/0316 GMT--May 28 Tel: +612-9375-5134
A research note from Goldman Sachs Hong Kong suggests that fundamentals point to medium term strength in the Australian dollar, but that the currency has experienced a structural decline, so the equilibrium level has fallen. The article identifies optimism about global growth, a decline in risk aversion, a widening yield spread and signs of stabilization in the domestic economy, as factors supporting a cyclical recovery.
However, a skewing of Australian productivity growth towards the non-traded sector, a rising savings rate and a downgrading of long-term growth prospects for Australia's trading partners, particularly in Asia, are seen as reasons behind the structural decline in AUD. BridgeNews |
