Halister News

(Bloomberg) -- AUD/USD may retest 0.7311 hit on Nov. 21 if 3Q GDP misses est., Bloomberg strategist Michael Wilson writes.

• 3Q GDP probably shrunk 0.1% q/q vs 0.5% prior, according to median est. of 24 economists surveyed by Bloomberg; range of ests. -0.5% to +0.4%; data due 11:30am local tomorrow
  • Year-on-year seen +2.2% vs +3.3% previously
• 3Q net exports cut 0.2 percentage point from GDP
• That led to downward revision in forecasts to -0.1% q/q, survey shows
• More hawkish than expected FOMC statement on Dec. 14 may further pressure A$; Credit Suisse sees market mispricing risk of more Fed hikes in 2017-2018
• WIRP pricing gives just 6% chance of RBA cut in February, allowing plenty of scope for repricing
• Recent rate increases by big local banks adds to need for lower cash rate to keep consumer and business lending rates relatively unchanged, Nomura notes
• AUD/USD Nov. 21 low of 0.7311 was weakest since June 24; now at 0.7448
• NOTE: Michael Wilson is an FX strategist who writes for First Word. The observations he makes are his own.