Amid speculation that fresh RBA forecasts could imply that it could take CPI inflation a little longer to return to target than previously estimated, market rates are suggesting that the RBA is likely to remain more hawkish on policy than either the Fed or the ECB. At first sight, this should be supportive for AUD/USD. However, in our view, the market is likely to continue pricing out some of the Fed rate cuts that had been anticipated for the first half of this year. This suggests scope for a firmer USD near term. 

We maintain a forecast that AUD/USD is likely to hold close to current levels at 0.6600 on a one-month view. 

We expect AUD/USD to trend towards 0.7000 at the end of the year.