ANZ assess where we are at, conclude "This is rarely a good environment for the AUD"

ANZ assess where the economy, fiscal policy and RBA are at after the Federal Reserve hike

This from their final 'Market Focus' series for the year.

Its a detailed piece, but in summary (bolding mine):

'LIFT OFF', NOW WHAT?

ECONOMIC OVERVIEW
· RBA Governor Stevens reiterated last week that he is content to "wait and see".
· The Commonwealth's mid-year budget update confirmed a deteriorating fiscal picture, largely reflecting the impact of lower commodity prices.
· The Fed tightened monetary policy for the first time in nearly a decade.
· Apart from some short-term market volatility, the world continued largely as before, and we believe Santa Claus is still coming.

INTEREST RATE STRATEGY
· Rates markets have reduced RBA rate cut expectations.
· Floating rates climb higher as funding pressures build.
· Longer-dated rates push higher following the Fed's policy move.

CURRENCY STRATEGY
· With the Fed out of the way, market attention can shift elsewhere.
· For FX markets, that means grappling with structural concerns like weak commodity prices and fragile emerging markets in an environment where liquidity is getting scarcer.
· This is rarely a good environment for the AUD.

COMMODITY STRATEGY
· China Commodity Price index edges lower.
· Oil prices fall on unseasonal build in US stocks.
· Weaker demand concerns re-emerge in base metals.

From all of us here at ForexLive, writers, comment contributors and readers alike, many thanks to all at ANZ for their work in providing research for us. Best wishes for Christmas and the New Year!