Australian dollar may gain on RBA policy and China’s stimulus measures – Bloomberg

Bloomberg reports that the Australian dollar may be headed for an annual gain, thanks to high interest rates of the Reserve Bank of Australia (RBA) and expected consumption stimulus in China. 

Westpac and Bank of America forecast the currency to rise to 68 cents by December. Meanwhile, National Australia Bank expects the Aussie to reach 65 cents by the end of June. 

The currency’s appeal got a boost after China, the largest trading partner of Australia, announced intensions to stimulate domestic spending in response to the US import tariffs, Bloomberg reports. 

Besides, the RBA’s reluctance to enter an easing cycle also supported the Australian dollar. Economists forecast the central bank to hold the rates steady at its meeting on April 1 after a February cut for the first time in four years, the news agency says. 

However, the Australian currency is likely to be volatile as the deadline for Donald Trump's reciprocal trade tariffs approaches. Westpac warns that the currency pair of the Australian dollar and the US dollar is likely to fall below 62 cents.