AUD is no longer the best performing G10 currency in the year to date, as it was just a few days ago. Economists at Rabobank believe that the AUD/USD pair could drop to the 0.67 mark over the next quarter before recovering later in the year.

Australian economy will avoid recession this year

“We see risks that AUD/USD could dip back to the 0.67 level on a three-month view on a combination of US recession concerns, a still hawkish Fed and expectations that the RBA is close to a peak in policy. However, on the expectation that the Australian economy will avoid recession this year we expect AUD/USD to find support and edge higher again in the second half of the year.”

“We forecast a move to 0.71 in 12 months.”