Bank of America (BofA) has maintained its forecast for the Australian dollar (AUD) to reach 0.68 against the US dollar (USD) by the end of 2025. This projection is based on expectations of a weakening USD and the positive effects of China’s economic stimulus measures. 

As of March 24, 2025, the AUD is trading around 0.62 USD, reflecting a decline from previous levels. In January, the AUD fell below 0.62 USD for the first time since 2022, influenced by a strong USD and economic uncertainties in China. 

BofA’s forecast aligns with other financial institutions’ projections. UBS Global Wealth Management anticipates the AUD will recover to 0.68 USD by the end of 2025, despite potential short-term dips below 0.60 USD due to global trade tensions and concerns about China’s economic health. 

The Reserve Bank of Australia’s (RBA) monetary policy stance plays a crucial role in the AUD’s performance. The RBA’s reluctance to enter an easing cycle has provided support for the AUD, contributing to expectations of a rebound. 

China’s economic policies also significantly impact the AUD, given Australia’s trade relationship with China. BofA’s forecast considers the anticipated positive effects of China’s stimulus measures on the AUD. 

In summary, BofA’s maintained forecast of the AUD reaching 0.68 USD by year-end reflects a cautiously optimistic outlook, considering factors such as a potentially weakening USD, China’s economic stimulus, and the RBA’s monetary policy stance.