FX and Your Business 18 June Friday Special Edition - a podcast by NAB Foreign Exchange

Phin Ziebell joins Ray Attrill, Head of FX Strategy. Phin asks Ray about the 2% sell off in the AUD post this week’s FOMC (Fed) meeting. Ray discusses the shift in expectations for US interest rates embedded in the FOMC’s so called ‘dot plot’ as being a key driver for this week’s USD strength and relate AUD weakness. Phin asks Ray about movement in other currencies against the USD, including the weakness of the EUR. Ray discusses the NAB (stronger) AUD forecasts as being maintained for Q3 and Q4 notwithstanding the probable ‘miss’ in the end-Q2 forecasts.

Ray backs this view by discussing global economic growth rebounding at pace in H2 2021, in a post COVID globally vaccinated economy, as something that is historically negative for the USD and positive for the AUD. Ray discussed how quickly FX markets can move and large moves are not unusual when the market forms the view that currencies are mispriced.

Phin finishes by asking Ray about interest rate differentials as a potential negative for the AUD

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