UBS Forecast: Australian Dollar Over-Sold, AUD/USD March 2026 Forecast 0.70 - Exchange Rates Org UK

What the desk is arguing

The desk frames the current positioning of the Australian dollar as undervalued based on UBS’s forecast that projects AUD/USD to reach 0.70 by March 2026. As cited, the Australian economy demonstrates resilience, with indicators suggesting a rebound in domestic consumption may support the AUD in the near term.

Supporting this outlook is the consensus across other banks, reflecting a range of targets with a median forecast of 0.6700 for March 2026, suggesting a uniform belief in a potential upward adjustment in the AUD/USD.

Where it sits in our coverage

Our consensus target for March 2026 is set at 0.6700, with a range between 0.6600 and 0.7300. Key firms projecting similar targets include: - goldman: 0.6600 - morganstanley: 0.6700 - jpmorgan: 0.6700

This view aligns closely with ubs, which also targets 0.7000, suggesting that our perspective is at the higher end of the existing forecast spectrum.

How other firms see it

Several firms echo this bullish stance on the AUD, notably bankofamerica, deutschebank, and hsbc, which predict modest recoveries in their projections for March 2026. In contrast, firms like mizuho and barclays present a more muted outlook, reflecting concerns over global economic headwinds.

A related focus should be on commodity prices, as movements in key exports like iron ore could significantly influence the AUD’s trajectory. Additionally, monitoring the RBA's policy responses will be vital for gauging changes in market sentiment regarding AUD/USD dynamics.