MUFG Research discusses the outlook of commodity currencies.
"High beta currencies extended their relief rallies yesterday reversing the heavy sell offs at the start of the week. While there is no clear fundamental trigger for the turnaround in investor sentiment, it appears to reflect an easing of more acute growth concerns in the near-term," MUFG notes.
"The relative underperformance of the AUD reflects domestic concerns even as global concerns appear to have eased somewhat...Speculation is already building that the RBA will quickly shelve plans to slow the pace of QE purchases after September, and may even increase the pace of purchases at their next meeting on 3rd August. Those negative domestic developments will put dampener on further upside potential for the Aussie in the near-term," MUFG adds.