While the RBA may maintain a dovish bias, Governor Stevens comments that monetary policy is not a cure-all imply that he has little desire to actually cut rates further.
Copy signals, Trade and Earn $ on Forex4you - https://www.share4you.com/en/?affid=0fd9105
However, over and above the Governor’s comments about the efficacy of rate cuts, the RBA is clearly concerned that lower rates would exacerbate already stretched household balance sheets. Despite the economy still exhibiting considerable slack, a reduction in negative sentiment toward China and a strong rebound in iron ore prices has seen speculative longs in the currency extend to levels last seen in September 2014.
The rally in AUD recently has tightened monetary conditions and will likely delay the rebalancing needed in an economy adjusting to lower commodity prices. That should work to weaken the currency over the rest of year.
In addition, investors should also beware of political risk ahead of the July 2nd general elections.
CIBC targets AUD/USD at 0.75, 0.73, and 0.74 by the end of Q2, Q3, and Q4 respectively.