AUD/CNY Outlook:
Slightly positive, but likely to move sideways, as the rate is above its recent average but lacks a clear driver for further gains.
Key drivers:
• Rate gap: The Reserve Bank of Australia has recently tightened its monetary policy, while the People's Bank of China maintains a more accommodative stance, favoring the AUD.
• Risk/commodities: The price of key Australian exports, particularly iron ore and coal, remains relatively high, supporting the value of the AUD against the CNY.
• Macro factor: Ongoing government stimulus in China is somewhat stabilizing economic activity, but uncertainties remain, which may dampen demand for the AUD.
Range:
The AUD/CNY is likely to hold within its recent 3-month range, with stable trading expected.
What could change it:
• Upside risk: A significant increase in global commodity prices could further boost the AUD.
• Downside risk: A sharper-than-expected slowdown in China could weaken demand for Australian exports, impacting the AUD negatively.