AUD/USD: Limited upside potential in the coming months – Rabobank

Economists at Rabobank expect poor levels of risk appetite to cap upside potential in AUD/USD in the months ahead.

AUD is sensitive to broad levels of risk appetite

If forthcoming domestic data releases suggest that the economic backdrop remains relatively resilient, further upside potential is likely for AUD/USD near-term as the market reassesses the risk of another RBA rate hike.

That said, the AUD is sensitive to broad levels of risk appetite. We expect that concerns over global growth and in particular the outlook for the Chinese economy, will limit upside potential for AUD/USD in the coming months.