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Westpac: Deviation Below Fair Value May Remain In Place For Some Time

AUD

A Westpac analyst notes that "the deviation between our fair value read and the A$ is currently at 7.5% which is still below the 10-Year max, of note that A$ has deviated by more and for longer than current, for instance at the end of 2013 where it deviated by circa 8% for 6 weeks. Given the current RBA YCC stance, last week's Covid lockdown news and slow Australian vaccination rates, China's recent verbal commodity intervention & ongoing trade tensions, it feels like the current deviation will remain in place for some time to come."

MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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