AUD High Yielding Commodity Currency

UBS maintains an 'Attractive' rating on the AUD, raising its AUDUSD target to 0.76 by mid-2027 driven by Australia's high yields and commodity exports. The bank favors unhedged exposure for investors diversifying away from the US dollar.

Key Takeaways

• 1.The AUD is rated as 'Attractive' and has outperformed most G10 currencies year-to-date due to positive terms of trade and attractive yield carry.
• 2.UBS has raised its AUDUSD price targets, projecting the pair to reach 0.73 by September 2026 and 0.76 by June 2027.
• 3.Investment preference favors unhedged AUD exposure and yield pickup strategies such as selling AUDUSD downside risks at or below 0.70.

Table of Contents

• CIO View: AUDUSD
• Global Asset Class Preference Attractive
• CIO Forecast- AUDUSD
• Global asset class preferences definitions
• Appendix
• Risk information
• Generic investment research – Risk information

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