AUD Mid Term View

If this article at FT's Alphaville [link] is to be believed, then Aussie Dollar is unlikely to weaken substantially against its US counterpart until the foreign direct investment pipeline turns sharply lower, which looks unlikely.


So far foreign investment has been the only driver making AUD so high. The bad thing is everything points to foreign investment and RBA believes central bank purchases haven’t been a major AUD driver. 

However, the good news, is that the investment
pipeline is stuffed for the next 12-18 months, so the money will keep flowing in. It likely that foreign investors may even be using negative AUD news to buy, so look for any dip in AUD to be supported.