What are AUD to USD forecasts?
The Australian Dollar (AUD) initially stumbled this week due to a souring market mood that affected demand for the risk-sensitive currency. However, it managed to bounce back during the European session. FX analysts now focus on the latest PMI surveys, as evidence of an ongoing contraction in manufacturing activity could weaken the AUD, although strength in the services sector may mitigate such losses. The Australian Financial Review's survey of 36 economists predicts the AUD to reach 0.71 USD by the end of 2023, but the range varies from 0.67 to 0.77 US cents. The consensus is that the Reserve Bank of Australia (RBA) would make its first-rate cut in early 2024.
On the other hand, the US Dollar (USD) experienced modest gains as its safe-haven appeal increased amidst a bearish market mood triggered by escalating Sino-American economic tensions. Economists expect the USD's strength to reverse in 2023 as the Federal Reserve's interest rate hikes cycle comes to an end. PMI data from S&P Global could dampen USD demand, with weaker services readings and stalling factory activity anticipated. In terms of price data for the past 3 months, the AUD to USD exchange rate at 0.6513 is 2.5% below its 3-month average of 0.6677, trading within a stable 4.2% range from 0.6507 to 0.6783. Market views emphasize how AUD is influenced by changes in commodity prices, trade policies, and political developments, while USD is expected to face a reversal in strength in the coming years.