New era. Howard out. Rudd in. Where does aussie head from here? Was recent sell off of obscenely priced aussie a "cover your profits" trade pending outcome of the election? Does it return to marching higher again? The US has already priced in a 100% chance of a 25 bp rate cut in Dec, even tho the Fed has indicated the last one may be the last one for a bit. Aussie land is expected to raise rates again by the first quarter 08. We've already broken thru support at fib 61.8 of the August lows to Nov highs. Perhaps over the next few sessions we may see a run toward the 50% at 8535-8550, esp with weak US equity markets, but return to bullish scenario I think is inevitable.
If the Nikki stops plunging, AUDUSD UP, if not watch out for more carry trade selling as risky assets undwind. My bet AUDUSD up from here as carry trade selling has stopped, maybe. RBA sets rates based on inflation its not political.