Selling the euro against the Australian dollar is a good medium-term play around the expectation that the FOMC will launch another round of easing this week as the benefits of QE3 for the Aussie and other commodity-block currencies will outweigh the risk of a slowdown in Chinese export demand, says State Street. While the Australian dollar underperformed in August, it sees that turning around as China implements more stimulus measures and as global growth bottoms out. The Aussie has gained 1.1% today to $1.0446.
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