AUD/USD at risk of dropping under 0.60 (unless China stimulates, big time)

<p>Commonwealth Bank of Australia flagging the risk of a sharper decline for the Australian dollar. Say <a href="https://www.forexlive.com/terms/a/aud/">AUD</a> will continue to underperform in 2023:</p><ul><li>We consider there is a growing risk that the Aussie dips
below $0.60 before year-end. </li><li>It will likely take a big Chinese
stimulus package focused on commodity-intensive infrastructure
spending to turn around the downtrend.</li></ul><p>—</p><p>The prospect of a big Chinese stimulus package seems remote. Despite the big words from the People's Bank of China, for example, they delivered a very disappointing monetary stimulus today:</p><ul><li><a href="https://www.forexlive.com/centralbank/pboc-loan-prime-rates-lpr-cut-1-year-345-prior-355-5-year-42-prior-420-20230821/" target="_blank" rel="follow" data-article-link="true">PBOC Loan Prime Rates (LPR) CUT: 1-year 3.45% (prior 3.55%) &amp; 5 year 4.2% (prior 4.20%)</a></li></ul><p>If the Australian dollar continues to dribble lower it'll be a factor for <a href="https://www.forexlive.com/terms/i/inflation/">inflation</a>, making imports more expensive at the margin. </p>

This article was written by Eamonn Sheridan at www.forexlive.com.