Westpac's G10 FX model "flips aggressively....>

FOREX: Westpac's G10 FX model "flips aggressively to a long USD exposure (+16%

of the portfolio) ahead of this week's widely tipped Fed rate cut. The recovery

in 10yr spreads back in the USD's favour is the main catalyst. The model quits

its AUD long though that position was never held with any real conviction - the

long AUD exposure never exceeded 10% and only lasted a few weeks. The collapse

in AUD-USD 10yr spreads to new record negative lows last week is the main

catalyst. The model has a similarly sized NZD short, leaving the model neutral

on the AUD/NZD cross. CAD is still heavily backed thanks to Canada's relatively

stronger growth signal and lack of rate cut pricing, a glaring anomaly in the

G10."