After a midweek dip to the 0.7250 area in the US Dollar (USD), Australian Dollar (AUD) pair price rebounded higher to this morning’s 0.7360 as the Aussie carves out gains as risk appetite turns sour and the greenback weakens. Usually risk currencies such as the NZD and CAD get squeezed lower, but we are in a war and markets are behaving peculiar to say the least. The Fed will likely dial back its tightening schedule this year as it juggles rising inflation and the economic fallout of the Russian/Ukraine war with the Fed hiking possibly 4-5 times. We expect the Fed to raise rates at next week’s meeting by 0.25%. RBA’s Lowe says they may increase their cash rate this year, data dependent. We think the AUD has more legs and could retest the early week high around 0.7440
Exchange Rates
The current interbank midrate is: AUDUSD 0.7358
The interbank range this week has been: AUDUSD 0.7244- 0.7440