Credit Agricole on AUD implications from the increase in US protectionism fears

Credit Agricole CIB Research on AUD FX after President Trump announced trade tariffs earlier this week:

tariffs on the imports of solar panels and washing machines, specifically targeting Chinese and Korean producers.

"The bigger question for investors is whether the US Administration is on the cusp of starting wide-ranging trade wars and dismantling of trade agreements such as NAFTA. While we believe further industry-specific protectionist skirmishes are likely, they should not unfold into a broad war...

Nevertheless, in terms of FX implications it increases our near-term caution of currencies such as AUD which have rallied beyond levels justified by near-term fundamentals, in our view," CACIB argues.

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