The recent break below parity of AUD/USD is getting most of the market's attention. In part, the AUD weakness reflects the dovish tone of the RBA, but the bigger driver is likely to be the rise in US rates, on the back of the recent batch of better US data, which has generated a USD rally across the board, says Goldman Sachs. Such a move in AUD/USD has led market participants to ask how far the AUD could weaken against the greenback and, relatedly, whether or not AUD/USD will recouple from its traditional drivers – namely interest rate differentials and commodity prices. To address this question, Goldman Sachs looks ... (full story)