AUD/USD seen at 0.82 by year-end – TDS

In opinion of Strategists at TD Securities, the Aussie Dollar could appreciate to the 0.8200 area vs. the greenback towards end of 2017.

Key Quotes

“Australian labour market has continued to strengthen, employment growth now 3%/yr, further supporting RBA's cautious optimism. We see higher wages growth and higher core inflation in due course. For mid-Nov, we expect wage inflation to pick up towards 2.%/yr by year end and core inflation to reside within the RBA's 2-3% inflation band. We stick with two hikes in May and Nov 2018”.

“Our AUD profile already reflects ongoing USD weakness as well as the RBA inching closer to an explicit tightening bias. If November brings solid employment and wages growth as we expect, could easily retest $US0.80. AUD dips remain shallow and the market is net long. Our year end target is $US0.82”.