Aussie dollar doldrums

Australian policymakers are on the back foot. Domestic demand is caught between falling house prices and rising unemployment. Solid trade data have provided support so far, but with global trade tensions still elevated and China looking to shift its growth paradigm over time, there are risks on the external side. The Reserve Bank has been alert to these and already lowered policy rates twice. It has more cuts up its sleeve, possibly as soon as October. That should push the Australian dollar lower.

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