Australian Dollar Forecasts – 2020 Overview

The bleak outlook in the US has added downward pressure on the world’s base currency and helped consolidate the Aussie dollars’ upturn. Although the Australian dollar has recently edged through the key 0.72 handle, a sustained move above this level has been hard to come by.

Further uncertainty in the US could push the AUD through 0.72 US cents.

In the second quarter of 2020 AUD staged a rapid recovery through the months of April, May and into June up 25% from its mid-March lows to US70c in early June. This is due more to the perceived benefits to Australia of an awakening post-pandemic Chinese economy than the political-social situtation in the US dpressing the USD.

The Aussie had been savaged in March sliding to US55 cents the lowest since 2003. Growing fears of the coronavirus outbreak moved the market into safer currencies such as the USD and away from AUD, NZD and CAD.

The virus was a double blow to the Aussie after the earlier threat of proxy war between the US and Iran in Iraq had also pared back some of the gains the Aussie had made coming into the New Year.

The Australian dollar had started the new decade strongly climbing to multi-month highs helped along by cooling trade tensions between the United States and China and optimism for global economic growth in the year ahead.

The Aussie broke back over US70 cents on the final day of 2019 — a level not seen since mid year. During December the Australian dollar reversed direction (again) and climbed steadily back up against the US dollar on the back of the strength of the housing market and a market perception that further interest rate cuts were less likely.

NAB have revised upwards their pound sterling forecasts now expecting the GBP/USD rate to be at US$1.47 by June 2022, up from their previous forecast of US$1.39. For 2020, it sees GBP at US$1.36 by year-end, up from a predicted US$1.30.

US dollar weakness has helped the embattled pound continue its recovery off June and early July lows. Despite this brief upturn, the outlook remains pessimistic as Brexit uncertainty and questions over the economy’s ability to rebound after the pandemic weigh on the currency. August Currency Update

Read more about FX Broker and Bank analysts' predictions for GBP to AUD future trends in our blog article GBP to AUD Broker & Bank Forecasts.

The euro is currently a more appealing investment than the US dollar as fiscal support and COVID-19 containment open the door to a faster paced recovery than what is likely in the US. With current USD weakness and strong long-term prospects for the European Union, there is speculation that the euro could be a contender as the world’s new reserve currency. In the short term the euro could be susceptible to swings, however in the longterm the euro has very good prospects. August Currency Update

Read more about FX Broker and Bank analysts' predictions for AUD to EUR future trends in our blog article AUD to EUR Broker & Bank Forecasts.

National Australia Bank (NAB) have revised upwards their Aussie/Kiwi dollar forecasts now expecting the AUD/NZD rate at NZ$1.09 by June 2022, up from their previous forecast of NZ$1.06.

For 2020, NAB sees the Australian dollar at NZ$1.09 by year-end, down a little from the previous predicted NZ$1.10.

Although New Zealand has nearly eliminated COVID-19 and wound back restrictions, its international borders are likely to be closed until 2021. This means the economy will be slower to rebound as its reliance on tourism outweighs that of major counterparts. Despite the New Zealand economy’s reliance on tourism, the NZD has been well supported by positive risk sentiment, higher NZ–US short term yields and robust commodity prices. August Currency Update

Read more about FX Broker and Bank analysts' predictions for AUD to NZD future trends in our blog article AUD to NZD Broker & Bank Forecasts.

AUD/HKD forecasts are influenced by three factors; the coronavirus impact on and response by both economies, changes in the delta between interest rates in Australia and the US (as HKD is pegged to USD) and also the trade war between China and the US and increasingly Australia.

Read more about FX Broker and Bank analysts' predictions for AUD to HKD future trends in our blog article AUD to HKD Broker & Bank Forecasts.