The aussie dollar is overvalued
In a subsequent speech the Governor strengthened his commentary around the AUD referring to it as “overvalued, and not just by a few cents”. He did not go as far as restoring the easing bias but did quote market pricing as indicating that ” if a move were to occur over the next several months … it would be down not up”. He also noted that “we still have ammunition on interest rates”. Market pricing is now pointing to a 40% probability of a rate cut by year’s end.