We expect solid gains from the Australian Dollar as 2024 progresses. 

While Australia's economic growth should slow next year amid an uncertain Chinese outlook, we do not expect an outright decline in activity. That is in contrast to the mild recession we forecast for the US, a relative growth performance that should support the Australian currency. 

Moreover, with Australian inflation elevated and receding only gradually, the Reserve Bank of Australia has resumed hiking rates. Further monetary tightening cannot be ruled out, and rate cuts are unlikely until late next year. Australian monetary easing should lag that of the Fed and, together, relative growth and monetary policy trends should be supportive of the AUD in 2024.