AUD/CHF Outlook: Slightly positive, but likely to move sideways, as the AUD remains above its recent average yet lacks a clear driver to maintain upward momentum.
Key drivers:
• Rate gap: The Reserve Bank of Australia is signaling potential interest rate hikes, while the Swiss National Bank maintains a 0% policy rate due to low inflation.
• Risk/commodities: Strong demand for commodities, especially iron ore, supports the AUD, but recent uncertainties regarding China's economic recovery may temper its gains.
• One macro factor: The upcoming CPI data on January 7 could provide more clarity on the AUD's trajectory.
Range: The AUD/CHF is likely to hold near recent levels, with slight movements possible but no significant tests of extremes.
What could change it:
• Upside risk: A better-than-expected CPI report could strengthen the AUD further.
• Downside risk: Continued weakness in China’s economy may undermine demand for Australian exports, putting pressure on the AUD.