AUD/ILS Outlook:
The AUD/ILS rate is currently trading above its 90-day average and is near recent highs, suggesting a bullish outlook. Continued Australian economic strength is driven by rising commodity prices and improving global conditions.
Key drivers:
• Rate gap: The Reserve Bank of Australia's recent interest rate hike increases the yield on AUD, making it more attractive compared to the Israeli shekel.
• Risk/commodities: Strengthening commodity prices, particularly gold, are beneficial for the Australian dollar as it boosts the economy and investor interest.
• One macro factor: Stubborn inflation pressures in Australia are likely to support further rate increases by the RBA, reinforcing AUD's strength.
Range:
The AUD/ILS is likely to hold within its recent range but may test the upper extreme due to positive external factors.
What could change it:
• Upside risk: A significant rise in commodity prices could further strengthen the AUD against the ILS.
• Downside risk: A surprising drop in Australian inflation figures could weaken expectations for future rate hikes, negatively impacting AUD.
