Last week, the Australian dollar was bullish along with other commodity currencies. At the beginning of a new trading week, however, the currency started to fall.
At the same time, analysts suggest that AUD will recover soon. All in all, the Australian currency has lost 0.2% to 0.7304. On Monday, August 30, AUD/USD fell to 0.7259.
According to experts, Australia is likely to move into a new recession, urging the Reserve Bank of Australia to loose its monetary policy.
Last week, the aussie and stocks traded higher. The currency remained extremely overbought. At the beginning of the new trading week, the Australian dollar dropped. However, many analysts assume this fall will be temporary. They expect the price to increase.
Westpac strategists think that the Australian dollar will surprise the market. The AUD/USD pair is likely to start rising from 0.7200 in the 4th quarter. The price is expected to strengthen as the risks associated with the COVID-19 pandemic reduce. By the end of 2021, Australia's economic growth is estimated to double: from 2.4% to 5.0% in 2022. In such a case, Westpac suggests, AUD/USD may rise to 0.8000 by 2023.
At the moment, the aussie is believe to be preparing for another rally. It remains to be seen how far the price may go. The currency is expected to recover shortly.
