(10 December 2024 – Australia) CBA FX Strategists warn that higher tariffs threatened by US President-elect Donald Trump will underpin the USD rally well into 2025, threatening to knock the Aussie Dollar below US60c.
CBA warns the strength of the US dollar is yet to fully reflect Trump’s policies and predicts that a renewed trade war will send the US dollar index to 110 by September next year. That would be the highest level since November 2022.
“We forecast the Australian dollar will fall materially further in 2025, possibly testing US60¢. The Australian dollar could fall further or faster if the trade war is more disruptive than we expect” CBA Head of International Economics Joseph Capurso commented.