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00:00COMPASS GLOBAL MARKETS IS HERE. THE AUSSIE PRETTY RANGE BOUND OVER THE LAST FEW SESSIONS. DO YOU FEEL WITH THE COMMODITIES STORE, A LOT OF PEOPLE ARE SAYING PARTICULARLY WHEN IT COMES TO IRON ORE, AS WELL AS THIS RHETORIC AS OF THIS IS AS GOOD AS IT GETS, AND THEREFORE THE AUSSIE DOLLAR. >> THE AUSSIE DOLLAR IS BEING QUITE RESILIENT. THERE'S A NUMBER OF REASONS WHY IT IS RESILIENT. WE HAVE SEEN THE TERMS OF TRADE IMPROVE BY ALMOST 60% YEAR ON YEAR. THERE'S ALSO BEEN A LOT OF SUPPORT IN TERMS OF SYDNEY HALF PRICES IN PARTICULAR. YOU MENTIONED THE PROPERTY MARKET, UP BY 18 PERCENT YEAR OVER YEAR. THE RBI IS KEEPING A CAREFUL EYE ON IT. THE GOVERNOR RECENTLY MENTIONED, HE SAID PEOPLE USING THE INTEREST RATE CYCLE IS AT THE END OF ITS JOURNEY, AND THAT MEANS THE MARKET IS NOW LOOKING AT THE NEXT PERHAPS BEING A LIFTING INTEREST RATES. POSSIBLY MIXED. THERE IS A CHANCE THAT RATES MAY GO UP IN AUSTRALIA NEXT YEAR. THE AUSTRALIAN DOLLAR IS HOVERING BETWEEN 73 AND 7810 LEVEL, WE BELIEVE THAT RANGE BOUND SITUATION WILL CONTINUE AS THE U.S. DOLLAR IS MORE STRENGTH, THE SHARE WITH FURTHER RATE HIKES EXPECTED IN THE U.S., SHOULD SEE THE AUSTRALIAN DOLLAR FINE AND LITTLE BIT OF SUPPORT BECAUSE OF THOSE TERMS OF TRADE. HAIDI: I'M JUMPING AROUND A BIT TO GO FROM THE AUSSIE DOLLAR TO THE UM. ONE OF THE INTERESTING THINGS TO COME OUT OF THE MPC DOCUMENT OVER THE WEEKEND, THE CHANGE IN WORDING FROM STABILITY TO FURTHER LIBERALIZATION. SOME MARKET PARTICIPANTS ARE SAYING INVESTORS SAY THIS CREATES A TOLERANCE FOR DOWNSIDE WHEN IT COMES TO THE U.N. QUITE A SIGNIFICANT MOVE AS PRICES GO, 8957. WHERE DO YOU SEE THE CHINESE CURRENCY GOING FROM HERE, PARTICULARLY WITH THE SENSITIVITY OF THESE CURRENCY WARS POTENTIALLY BEING LABELED CURRENCY MANIPULATION BY THE TRUMP ADMINISTRATION? >> IT REMAIN SENSITIVE TO THE FISCAL STIMULUS AND THE SITUATION IN THE U.S. AS WELL. IT'S INTERESTING IMAGINED THE CHINESE PREMIER'S COMMENTS OVER THE WEEKEND. HE SAID HE WANTS TO STICK TO A MARKET ORIENTATED EXCHANGE RATE REGIME, AND HE MENTIONED THE WORD STABILITY. THAT TO ME MEANS WE WILL SEE MORE MARKET-BASED APPROACH, WHEN IT COMES TO THE YUAN. OUR BASELINE CASE HASN'T CHANGED. WE THINK THE U.S. DOLLAR WILL RALLY BY ANOTHER 5% OR 6%. WE COULD SEE DOLLAR-YUAN BACK UP TO 7.4. AS LONG AS THE CHINESE GOVERNMENT IS HAPPY TO KEEP THE MARKETPLACE APPROACH INTACT, THEN WE SHOULD BE THE YUAN WE CAN AS THE U.S. DOLLAR STRENGTHENS. RICHARD: WHAT DOES IT ALL MEAN ALSO, WITH THE FED. THE FED IS A DONE DEAL, IT LOOKS LIKE, NEXT WEEK. IT LOOKS LIKE MAYBE THREE THIS YEAR. HOW DOES THAT PLAY OUT WHEN IT COMES TO THE U.N.? >> ABSOLUTELY. IT LOOKS LIKE IT IS FULLY PRICED INTO THE MARKET. THE SITUATION THERE IS U.S. ECONOMIC DATA CONTINUES TO IMPROVE. AND EVEN THE FED CHAIR JANET YELLEN OVER THE WEEKEND TALKED ABOUT MARCH BEING APPROPRIATE FOR A RATE HIKE. MY CONCERN IS WE MIGHT ONLY SEE 2 RATE HIKES THIS YEAR INSTEAD OF MARKETS EXPECTED 3. U.S. TREASURY SECRETARY MNUCHIN CAME OUT RECENTLY AND SAID HE AIMS TO PASS LEGISLATION THROUGH CONGRESS BASED ON U.S. TAX REFORM BILL, PERHAPS BY AROUND ABOUT AUGUST THIS YEAR WHEN THE CONGRESSIONAL RECESS TAKES PLACE. I GUESS WE'VE GOT TO WAIT 5 TO 6 MONTHS BEFORE WE GET A FEEL FOR WHAT IS HAPPENING WITH TAX CHANGES IN THE U.S. THE MARKET MAY LOOK AT -- CERTAINLY MARGINS FULLY PRICED IN, SEPTEMBER ON THE RADAR. WE MIGHT HAVE TO WAIT UNTIL 2018 BEFORE WE GET A FEEL ON THE IMPACT ON THE U.S. ECONOMY FROM THEIR. THAT COULD SEE THE U.S. DOLLAR CONTAIN ITSELF. YOU CAN PUT A LID ON THE U.S. DOLLAR, WHICH WOULD THEN SEE OTHER DOLLAR BLOC CURRENCIES PERHAPS BENEFIT FROM THAT MOVE. RICHARD: YOU SAID 5% INCREASE IN THE DOLLAR. WHO IS GOING TO TAKE THE BRUNT OF THAT? IT LOOKS LIKE WE ARE GETTING SOME OF THAT EVENT RISK IN THE FUTURE, POLITICAL RISK SUCH AS THE DUCK -- DUTCH ELECTION A GERMAN ELECTION ALREADY PRICED IN, AND THE EURO FIRMING UP. PERHAPS INVESTORS LOOKING EASED OVER THOSE CONCERNS. CERTAINLY BREXIT IS ALSO OUT THERE. >> INDEED. WE HAVE SEEN THE STERLING POUND FALL TO TWO-MONTH LOWS. AND IN EUROPE AS WELL, WHEN WE LOOK AT WHAT'S HAPPENING THERE, THE UNCERTAINTY REGARDING ELECTIONS IN THE NETHERLANDS, IN FRANCE, IN GERMANY IN SEPTEMBER AND POSSIBLY EVEN ITALY, WHO KNOWS? THAT SORT OF UNCERTAINTY IS SEEING A LOT OF EUROPEAN FUNDS GO ELSEWHERE TRADED AS BENEFITING THE DOLLAR BLOC CURRENCIES LIKE THE U.S. AND AUSSIE DOLLAR. WE COULD SEE THE EURO FIND ITSELF BACK TESTING THAT SUPPORT LEVEL OF 103, IN COMING WEEKS,

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Compass Global's VP Says Aussie Dollar Quite Resilient

Compass Global Markets Vice President Tony Boyadjian discusses his outlook for the Aussie dollar, Reserve Bank of Australia policy and talks about the yuan. He speaks on "Bloomberg Markets." (Source: Bloomberg)

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