In the view of economists at HSBC, both the Australian Dollar and the Loonie are likely to face risk sentiment challenges over the near term, before a bumpy recovery in 2023.
Near-term challenges
“If the coming weeks bring a fresh bout of risk aversion (amid a still hawkish Fed, global growth concerns, and reasons for caution elsewhere), then both the CAD and AUD are likely to weaken against the USD.
“Our medium-term view is that both commodity currencies will probably be on a bumpy recovery path in 2023, as the Fed’s hiking cycle comes to an end.”
