SYDNEY, March 3, 2026, 07:19 AEDT
- Barrenjoey puts the Aussie north of 75 U.S. cents, while ANZ is calling for 73 cents by year-end, noting speculative longs remain stretched.
- AUD/USD slid to around 0.7033 after weekend war headlines rattled markets, but clawed its way back closer to 0.7100, according to a Westpac strategist.
- Australia’s national accounts for the December quarter land March 4. Crowded positioning could open the door to a sharper move.
Strategists see further gains ahead for the Australian dollar against its U.S. counterpart, even with bullish positioning lingering at highs not seen in over eight years. Barrenjoey Markets is looking for the currency to push past 75 U.S. cents. Australia & New Zealand Banking Group, for its part, has a year-end target of 73 cents.
The bullish call drops right before a crucial moment: Australia’s December-quarter national accounts hit on March 4, 11:30 a.m. AEDT. A solid number could keep bulls in charge. But if the data disappoints, crowded positions could unwind quickly.
Kaitlyn Buhariwalla at Westpac noted the pair finished above 0.7100 on Friday, before sliding into the mid-0.7000s as trading kicked off Monday. It then “clawed” its way back toward 0.7100, she said. Buhariwalla flagged the likelihood of further risk-off moves this week, with markets watching for remarks from RBA Governor Michele Bullock and other top officials. Westpaciq
Carry trades keep dragging the Aussie higher. The strategy involves borrowing in currencies with lower rates to buy those with better yields, capturing the rate differential. Australian media this year have picked up on fresh enthusiasm for the trade.
The Reserve Bank of Australia bumped its cash rate target up by 25 basis points to 3.85% at its February meeting, giving fresh backing to the country’s yield advantage. Higher rates on home turf usually bolster the currency, as they boost returns on Australian assets.
But the market remains anything but steady. Oil and gas surged, equities lost ground, and the dollar strengthened Monday as the U.S.-Israeli conflict with Iran escalated, nudging investors toward safer assets and fueling fresh concern about inflationary pressure from energy. “Global markets [are] on edge,” said Chris Zaccarelli, chief investment officer at Northlight Asset Management. Reuters
The Canadian dollar slipped despite a jump in oil, flashing a caution sign for commodity-linked peers. Risk aversion outweighed crude’s rally, and similar pressure could weigh on the Aussie if traders keep slashing exposure.
Short-term traders are eyeing charts instead of GDP projections. IC Markets, in a TradingView post, pointed to a key level at 0.7086. First resistance sits at 0.7234; support’s close by at 0.6996.
Price moves trace back to how traders are positioned. In the market’s lingo, “speculative bullish bets” points to leveraged plays—usually futures—that pay off if the currency climbs. The real issue isn’t the direction, it’s how packed these trades have become.
Crowded trades can unravel quickly. Should the conflict escalate, there’s a good chance investors will keep piling into dollars while shedding higher-risk currencies. Joerg Kraemer, chief economist at Commerzbank, pointed out that markets “seem to be expecting a shorter war lasting only a few weeks”—a shaky bet that could face a reality check soon. Analysts at Barclays flagged the risk: investors might be discounting just how likely it is that containment doesn’t hold. Reuters
Barrenjoey’s still holding tight to their bullish 75-cent call, while ANZ targets 73 cents by year-end. Eyes are on Wednesday’s GDP release next, with everything else in the headlines along the way.
