Research Team at Bnp Paribas, notes that the net long AUD positioning has started to moderate according to BNP Paribas Positioning Analysis falling to +3 this morning from +8 a week earlier – its largest long since November 2014.

“We are short AUD via a long EURAUD trade recommendation. The RBA was surprisingly silent on AUD strength at the March meeting, but with trade-weighted AUD up another 4% since then, Governor Stevens will get a chance to clarify the Bank’s message on Tuesday.

Markets are also long CAD at +5. Canada’s government is due to announce its budget on Tuesday. Anticipation of increased Fiscal spending has allowed the BoC to refrain from easing and helped the recovery in the CAD. However, in the likely absence of significant spending beyond what has already been signalled, we believe this is already priced in and in any case our economists expect only a moderate fiscal boost to GDP in 2016. With short CAD positioning unwound and the risk of the BoC turning more resistan