A rally is still on the cards – ING

The AUD OIS curve also includes a rate cut by the end of the year, note ING FX analysts Francesco Pesole and Chris Turner.

0.68 still seems within reach for the AUD

“This is certainly possible if Australian inflation eases and the Fed cuts big, but for now the Reserve Bank of Australia is keeping the threat of a rate hike. It’s one of the reasons why the Aussie dollar can perform well in the short term.”

“The RBA should have tightened policy more and we still can’t rule out another hike if we see more acceleration in monthly CPI prints.”

“All of this means that the Australian dollar (AUD) could remain one of the market’s favorite currencies to play risk waves this summer, and 0.68 still looks within reach. However, the risks associated with a potential Trump re-election mean a less optimistic medium-term outlook.”