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14 May 2015
RBA could try to talk down the AUD – Rabobank
FXStreet (Edinburgh) - In the view of Jane Foley, Senior FX Strategist at Rabobank, believes the RBA could act on the Aussie dollar.
Key Quotes
“The prospect of stalling Chinese demand for Australian exports remains a concern”.
“Iron ore has found support on news that Vale of Brazil could temporary slow iron ore exports and on reports that BHP will defer spending on iron ore expansion in W. Australia”.
“Insofar as the latter announcement will underpin general concerns about falling investment and jobs growth, it is of limited comfort”.
“The collapse in metals and energy prices is also forecast to have blown a hole in the government’s estimates of tax revenues”.
“As a consequence, the budget is likely to err on the side of austerity”.
“With little support for growth expected to come from fiscal policies, the RBA has cut interest rates to 2% on May 5 and we expect further efforts to talk the AUD lower”.
Key Quotes
“The prospect of stalling Chinese demand for Australian exports remains a concern”.
“Iron ore has found support on news that Vale of Brazil could temporary slow iron ore exports and on reports that BHP will defer spending on iron ore expansion in W. Australia”.
“Insofar as the latter announcement will underpin general concerns about falling investment and jobs growth, it is of limited comfort”.
“The collapse in metals and energy prices is also forecast to have blown a hole in the government’s estimates of tax revenues”.
“As a consequence, the budget is likely to err on the side of austerity”.
“With little support for growth expected to come from fiscal policies, the RBA has cut interest rates to 2% on May 5 and we expect further efforts to talk the AUD lower”.