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


  • 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 

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

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