Will the Australian dollar repeat its recent end-of-year rallies?

While the RBA is not expected to alter its policy at today’s meeting, James Swerling from Ebury says it has the opportunity to hedge its bets a bit with the next meeting being two months away.

He is expecting the central bank to add in a bit about wanting to see how the data pans out before they pare back Quantitative Easing and he says typically the February meeting is the big get together as a result.

James says the Australian dollar has recorded strong rallies between the December and February meetings in three of the last four years.

James also has a keen eye on the Chinese Renminbi. He says in spite of the US Dollar index hitting an 18 month high, the CNH has hit a two and a half year high against it. James says the CNH is starting to become a reputable store of value currency, despite the Evergrande saga. He points out that reserve ratios are being trimmed and China’s bounce back is being muted.

Watch the full interview here