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Stay short AUD vs USD and CAD, even if risk environment improves - BNPP

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 11, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Delhi) – Research Team at BNP Paribas, suggests that AUD weakness since the start of the year is consistent with China worries and the equity market sell-off but we think prospects for an AUD recovery are limited even if sentiment stabilizes.

    Key Quotes

    “Any rebound in stocks and commodity prices is likely to be accompanied by a fairly quick recovery in Fed expectations, keeping rate differentials moving against AUDUSD. Furthermore, BNP Paribas FX Positioning Analysis signals short AUD positioning remains light, reducing scope for a short squeeze. Australian data has held up well so far but may stumble going forward. Our economists expect the December jobs report to show the unemployment rate rising to 6% on Thursday. We remain short AUDCAD and, via options, short AUDUSD.”
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