AUD Q3 Fundamental Forecast: Australian Dollar Outlook Mired by Dovish RBA Forward Guidance 2021-07-03 00:30:00 David Song, Strategist The Australia Dollar faced headwinds throughout the second quarter of 2021 as the Reserve Bank of Australia (RBA) offered a dovish forward guidance for monetary policy, with AUD/USD trading to a fresh yearly low (0.7477) in June as Federal Reserve officials project two rate hikes for 2023. The minutes from the June meeting suggest the RBA is on a pre-set course as the central bank looks to complete the “second $100 billion of purchases in early September 2021,” and it seems as though Governor Philip Lowe and Co. are in no rush to switch gears as “monetary policy would be likely to need to remain highly accommodative for some time yet.” In turn, the RBA may utilize its quantitative easing (QE) program throughout the remainder of the year as “members thought it would be premature to consider ceasing the program,” and the central bank may keep the door open to further support the economy as the board pledges to “maintain highly supportive monetary conditions until its goals for employment and inflation were achieved.”