In the view of economists at Société Générale, the Australian dollar should be a winner from monetary policy normalisation. The AUD/USD pair could head towards 0.80 and beyond if inflation data supports the case for rate hikes from the Reserve Bank of Australia (RBA).
“The rates market doesn’t expect a hike at the 5 April RBA meeting but does expect the first hike to come in 2Q. The 1Q CPI data release, on 27 April, will be important in that regard.”
“If it is a green light for policy tightening, it can set AUD/USD 0.80 and beyond.”
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