Forecasts for the AUD/USD in 2019 are influenced by two factors; changes in the delta between interest rates in Australia and the US and also the trade war between China and the US. Banks are predicting AUD/USD to drop towards 65-66¢ - a rate that hasn't been seen since 2009.
Australian dollar to US dollar bank forecasts
In early October TD Securities updated their forecast for the AU dollar “There’s little reason to expect that the Australian dollar will appreciate anytime soon” with the reasoning that further rate cuts by the Reserve Bank of Australia will dampen demand for AUD.
In mid August NAB updated their AUD/USD forecasts to incorporate mounting pessimism that the US–China trade deal will be resolved this year. The bank slashed their Aussie dollar forecast to US65 cents by the end of the year, from US73 cents. “Our expectation is that the People’s Bank of China will allow the yuan to continue to appreciate” taking it to 7.4 yuan per US dollar, they said.
In early August the Australian dollar sunk to a 10 year low of 67¢ (Aug-7) to the US dollar. This was due to the RBA twice cutting interest rates plus the offshore yuan breaking the symbolic and closely watched USD/CNY = 7.0 exchange rate, after the trade war flared up again and the US labelled China a “currency manipulator”.
In May, ANZ slashed its year-end AUD/USD forecast to 65¢, from 70¢, in response to the “enduring” nature of the US-China trade spat. Westpac also cut forecasts to 66¢ and GSFM matched this when it called for rates in the “mid 60s.” Exchange rates in the 65-66¢ region haven’t been seen since 2009.
You can read more about AUD cross-rate forecasts here AUD Trends and Forecasts for 2019.
Forecasts and predictions for the AUD/USD exchange rate change all the time, affected by news events and relative sentiment towards the Australian and US economies. This continually updated article reviews AUD to USD bank forecasts and recent trends for both currencies.