AUD/HKD Outlook:
The outlook for AUD/HKD is 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 raised interest rates, creating a favorable contrast to the Hong Kong Monetary Authority's fixed rate stance.
• Risk/commodities: The AUD remains supported by commodity prices, influenced by strong demand for Australia’s key exports like iron ore, which shapes investor confidence.
• Macro factor: Recent inflation data in Australia, showing an increase beyond the RBA's target, has heightened expectations for additional monetary tightening, benefiting the AUD.
Range:
EXPECTED movement for AUD/HKD is likely to hold within the recent 3-month range.
What could change it:
• Upside risk: A more aggressive RBA monetary policy could boost the AUD further against the HKD.
• Downside risk: Weakening demand for Australian exports due to global economic shifts could pressure the AUD lower.
