AUD/PKR Outlook:
Slightly positive, but likely to move sideways as AUD is trading above its recent average, without a clear driver.
Key drivers:
• Rate gap: The Reserve Bank of Australia’s recent rate hike supports a stronger AUD compared to the Pakistani central bank, which faces ongoing challenges.
• Risk/commodities: With oil prices remaining stable, demand for Australian commodities is likely to bolster the AUD.
• One macro factor: High inflation in Pakistan is eroding the PKR's value, adding pressure to its exchange rate.
Range:
AUD/PKR is expected to hold within its recent 3-month range, possibly drifting rather than testing extremes as both currencies face respective challenges.
What could change it:
• Upside risk: A continued commitment from the RBA to tighten monetary policy further could drive the AUD higher.
• Downside risk: An escalation of geopolitical tensions impacting trade could lead to a sharper decline in the PKR.
