AUD/TRY Outlook: The outlook for AUD/TRY is slightly positive, but likely to move sideways, as the rate is significantly above its recent average but lacks a compelling current driver.
Key drivers:
• Rate gap: The Reserve Bank of Australia (RBA) is likely to hike rates due to rising inflation, while the Central Bank of Turkey has recently cut its benchmark rate, widening the gap between the two currencies.
• Risk/commodities: A decline in commodity prices, particularly precious metals, may put pressure on the Australian dollar as it influences export revenues.
• One macro factor: Weak manufacturing data from China could dampen demand for Australian exports, negatively impacting the AUD.
Range: The AUD/TRY is expected to drift within its recent range, with potential fluctuations based on upcoming economic data.
What could change it:
• Upside risk: A stronger-than-expected inflation report from Australia prompting the RBA to raise rates sooner.
• Downside risk: Continued weakness in global commodity prices that reduces demand for the AUD.
