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Barclays recommend selling EUR/AUD (spot......>

FOREX: Barclays recommend selling EUR/AUD (spot ref: A$1.5840) targeting
A$1.5675, below year-to-date lows, with a stop-loss at A$1.5930.
- Barclays write "this week's RBA decision is unlikely to provide an explicitly
dovish forward guidance, disappointing market expectations of near-term rate
cuts (the 7 May meeting is priced at -7bp for example), and provide further
support to AUD crosses. We expect the RBA to reiterate its neutral stance and
maintain our view of unchanged policy for the foreseeable future. The Australia
Federal Budget will also be released on Tuesday (19:30 Sydney time) and should
project an imminent return to budget surplus (the first in 12 years). We think
the combination of a China PMI rebound and less dovish RBA will be sufficient to
trigger a rally in the AUD, especially given the extreme short AUD positioning
and long rates. We prefer to use the EUR as the funder of choice and remain
structurally short EUR/USD."
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |

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