Morgan Stanley on AUD/USD – sell it! (AUD vulnerable on trade, USD support from growth)

Morgan Stanley client note (via Bloomberg) – in brief

AUD vulnerable to

• slowing economy
• threats to international trade
• rising U.S. funding costs
• neutral positioning on AUD means further selling will have impact

USD

• should be supported by robust US growth
• Positive earnings momentum
• Growth, trade concerns may weigh on investment and liability flows from the US, leading to USD strength

MS trade reco:

Short AUD/USD at 0.7770 

• target 0.6900
• stop 0.7910

Risk to the trade is that global funding flows accelerate, leading to USD weakness 

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Some interesting and different slant on things there from MS. The sell point on AUD/USD is way away too.