RBA moving ahead with more purchases to the tune of $4 Billion per month.

I anticipate that even though the RBA dosent like a strong AUDUSD, the current recourse of actions will drive prices higher against the US dollar.

The constanza effect tends to occur on the AUD currency alot.

The principle can be noted by having negative data for jobs but its correlated with a rise in price, why? because the secondary effect means that stimulus is more likley which in turns provides more liquidity and liquidity is good for stocks etc.

While the needs to purchase more bonds comes from yields climbing on the long term basis, the effect is a stronger currency offset by the RBA.

AUDUSD - Long

Mar 01 2021

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