Economics
How to Halt the Aussie's Drop? Do Nothing
- Currency won’t break below 70 U.S. cents near term: Westpac
- Odds of June RBA cut are about 11%; 1-in-3 chance of Fed hike
Australian one-hundred dollar banknotes.
Photographer: Brent Lewin/BloombergThis article is for subscribers only.
June holds the promise of better days to come for the worst-performing major currency this month.
After a 5.1 percent slump in May, Australian dollar declines won’t extend below the 70 U.S. cent level in the near term as the Reserve Bank of Australia and the Federal Reserve are both unlikely to change interest rates at their June meetings, according to Westpac Banking Corp., Australia’s second-largest lender by market value. The odds favor that case as futures trading indicates an 11 percent probability of the RBA making a back-to-back cut in June while there’s a one-in-three chance the Fed will increase its key rate.