AUD/USD TO STRUGGLE TO EXTEND ITS RACE HIGHER – COMMERZBANK

On Monday, AUD/USD was able to extend its gains and climbed above 0.71. Nevertheless, economists at Commerzbank remain cautious as far as AUD is concerned.

AUD GAINS SUSTAINABLE?

“The RBA’s monetary policy is likely to support AUD since it hiked its key rate at the start of the month and signalled further tightening. However, a more restrictive monetary policy has probably already been priced into a large extent. In addition, the US central bank is also hiking its key rate – at a more rapid pace. Therefore the AUD is likely to struggle to make further ground against USD.”

“The zero covid strategy of Australia’s important trade partner China entails economic concerns so that investors are likely to remain cautious.”