Advantage gone: Australian dollar bank notes of various denominations are arranged for a photograph in Sydney. Australia’s two-year yield advantage over the US has almost vanished yesterday. — Bloomberg
SINGAPORE: Australia’s dollar is set to fall to the weakest since the aftermath of the global financial crisis in 2009 as it loses its standing as a high-yielding currency, according to Morgan Stanley.
The Aussie will probably drop to 65 US cents in 2019 as the nation’s benchmark rate will eventually go below the Federal Reserve’s, said Hans Redeker, the London-based chief global currency strategist at Morgan Stanley, the most bearish forecaster of the currency. Australia’s two-year yield advantage over the US has almost vanished, shrinking to just two basis points yesterday.
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