The rising cost of hedging the Aussie dollar.
This week saw the AUD fall close to 3% to below 0.66c against the USD – while also seeing similar falls against all its major peers (CNY, NZD, GBP, EUR).
Patrick Idquival from Ebury says this feels a bit oversold, and markets got a bit trigger-happy selling the AUD with the dovish hike that we saw on Tuesday. Patrick’s bets are still on an AUD rally this year on the back of Chinese growth, as manufacturing activity is growing and China is picking up steam.
Watch full interview here