National Australia Bank: Reserve Bank of Australia expected to cut interest rates in 2027, Australian dollar outlook is bleak.

The National Australia Bank has a bearish outlook on the Australian dollar in 2027, citing expectations that the Reserve Bank of Australia will cut the official cash rate by 75 basis points starting in the second quarter of 2027. The National Australia Bank currently forecasts that the Australian dollar against the US dollar will end at 0.6700 by the end of 2027, lower than the previous expectation of 0.7000, but the institution believes that the Australian dollar against the US dollar will eventually fall to at least 0.6500 at some point. The National Australia Bank also adds that if the Reserve Bank of Australia cuts interest rates next year while the Federal Reserve remains unchanged, the outlook for the Australian dollar will become increasingly bleak.