Bank of America Recommends Buying AUD/USD Amid China Growth

Investing.com – Bank of America has issued a buy recommendation for the Australian dollar versus the US dollar at 0.6546, with a target of 0.69 and a stop‑loss at 0.6350.

This bank identifies the Australian dollar as the second worst‑performing currency in the G10 group from the beginning of the year to date, only behind the Canadian dollar, but it forecasts that the AUD/USD pair will become one of the best‑performing G10 currency pairs in the latter half of 2025.

Bank of America cites “favorable factors growing stronger” for the AUD/USD pair, especially highlighting the expected recovery in Chinese economic growth and the probability of reduced negative impacts from policy on risk appetite.

Regarding the US dollar, the bank predicts a continuing “devaluation of the USD, albeit at a slower pace,” noting that the Federal Reserve’s final rate cut will reduce real dollar sales and is expected to limit the dollar’s potential to appreciate.

Bank of America warns that the risks for this trade include “negative shifts in risk appetite,” which could coincide with the end of the US‑China tax pause on 12 August.

You should buy which shares in the next trading session?

The power of AI computing is shifting the landscape of the stock market. Investing.com’s ProPicks AI tool includes six profitable stock portfolios selected by advanced AI technology. In 2024, ProPicks’ AI technology identified two stocks that increased by more than 150%, four stocks that rose by more than 30%, and three stocks that increased by more than 25%. So which stock will rise next?