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Jun 29 - 05:00 PM
AUD/USD: Shorts Looks Stretched Into Next Week's RBA - BNPP
First appeared on eFXplus on Jun 29 - 12:10 PM

BNP Paribas Research discusses AUD outlook into next week's RBA meeting and notes that shorts looks stretched which makes AUD prone to a bounce on any hawkish tilt from the RBA.

"The Reserve Bank of Australia (RBA) meets on 3 July. The RBA continues to reiterate a dovish message and as a result rates markets only price the first hike by Q4 2019. BNP Paribas Positioning Analysis shows that AUD short positioning (along with NZD and CAD) has built quickly in recent weeks as trade war concerns challenged risk sentiment.

AUD short exposure currently stands at -18 (-/+ 50 scale) from a neutral score at the beginning of June.

Given short FX market positioning and dovish RBA expectations, the currency should benefit from even an incrementally more hawkish RBA message or any improvement in risk sentiment," BNPP argues. 

Source:
BNP Paribas Research/Market Commentary

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