AUD/USD: BNP gives 3 reasons why the AUD will continue to fall

In a note published today, BNP Paribas gives 3 reasons why it maintains a bearish view on the AUD/USD:

1- Australian economic data

"Although business data has positively surprised us, inflationary pressures remain low, suggesting that the RBA will ease again, probably in August, according to our economists' forecasts."

2- Support from trade with China will continue to weaken

"The rebound of the AUD in March-April was mainly due to improved sentiment about China, but our economists believe that recent indicators suggest that growth will slow in China.

3- Expectations for higher US rates will continue to rise

"Finally, with regards to the dollar, greater expectations in terms of higher Fed rates should lead to a further rise of the dollar, which will also help the AUD/USD to fall."