UBS believes that the AUD/USD pullback presents a buying opportunity

2026-03-06 13:05:41

Investing.com - UBS recommends going long on the Australian dollar against the US dollar at the 0.6990 level, with a target price of 0.75 and a stop loss set at 0.68.

The bank states that the recent decline in AUD/USD caused by rising risk aversion provides an opportunity to increase AUD exposure.

UBS’s optimistic outlook on the AUD is based on the widening short-term interest rate differential between Australia and the US, which they believe will attract portfolio investment and prompt Australian pension funds to hedge currency risk.

UBS notes that Australia’s strong energy trade surplus continues to support the AUD. The bank points out that natural gas and coal exports account for about 3% of GDP.

They mention that even with ongoing oil imports and high energy prices, this energy trade position still provides support for the AUD.

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