AUD and NZD interest rate cuts?
 

Interest rate decisions on AUD and NZD coming up, may affect exchange rates.

http://news.ft.com/servlet/ContentSe...=1012571727143

Trading in the Australian dollar was also dominated by interest rate-watching on Tuesday.

Later, the Reserve Bank of Australia will announce its rate decision, but no statement accompanies the decision. Like Canada, the bank is expected to leave interest rates on hold.

The Australian dollar was at US$0.658 on Tuesday, off a recent three-year high at US$0.662.

Australian rates are at 4.75 per cent and ensure Australian bonds yields, like Canada, offer a considerable premium to US and eurozone paper. The currency was recently helped by the hawkish tone of RBA's last policy report which lowered growing expectations the currency's strength would lead the bank to cut rates in the near future.

The New Zealand dollar was slightly softer as investors looked ahead to the Reserve Bank of New Zealand's rate decision, due late on Thursday. The bank is expected to make its second rate cut this year.

"Our 'house' call is for the RBNZ to err on the side of caution and cut by 25 basis points," said Karen Pringle, strategist at ANZ Bank. "However I think the probability of a more pre-emptive 50bp cut is somewhat higher. "A larger move will be more effective if the RBNZ is serious about getting the currency down."

The NZ dollar was at US$0.579 on Tuesday, off its recent five-year high of US$0.586.

Re: AUD and NZD interest rate cuts?
 

No change in Australia , rubber dolllar still on the UP.


:D :cool: :beer:

4 June 2003
At its meeting on 3 June the Reserve Bank Board decided to leave the cash rate target unchanged at 4.75 per cent.

Just seen it, PB you're probably not wrong, this will be good for AUD strength particularly if there's an interest cut in NZ or Eurozone.

Cheers - Don

Live mid-market rates as of 2003.06.04 04:23:40 GMT.
1.00 GBP
United Kingdom Pounds = 2.46674 AUD
Australia Dollars
1 GBP = 2.46674 AUD 1 AUD = 0.405394 GBP

Hasn't been this strong in a while.

Cheers - Don

Do you still stand by your earlier "prediction" that it`ll be 2:1 before too much longer? If so, why???

Trend is still intact of AUD rising vs GBP. Yes, I think 2:1 is quite plausible within about 8-12 months. Why? A host of reasons such as commodity currency strength, relative GDP growth, net immigration as % of population, sentiment, fair value, UK housing/ commercial property crash, capital flows etc etc.

Cheers - Don

Well you are making my mind up , thanks Don.



:D :cool: :beer:

Re: AUD and NZD interest rate cuts?
 

RBNZ cut by 0.25% today. If anything this has strengthened the NZ$ because some thought they might cut 0.5%. They will probably cut another 0.25 next month, assuming the NZ$ continues to rise.

John

During periods of 're-alignment' currencies often over-shoot as well. 2-1 is a def. possibilty over the next year.

NZD:

The strong rise of the New Zealand dollar would put downward pressure on inflation, albeit temporarily. The bank's forecasts assume the currency will ease over the next two years but Dr Bollard accepts "that might not be the most likely outcome".

"Foreign exchange market dynamics, interest rate differentials, and the possible correction of an excessively elevated US dollar combined to make further appreciation more likely than depreciation."

The inflation rate is projected to fall from 2.5 per cent to 1.5 per cent by the end of this year mainly due to the effects of the stronger New Zealand dollar.

New Zealand's official interest rates are now just half a percentage point above Australia's 4.75 per cent. The Reserve Bank of Australia yesterday decided the Australian economy was robust enough not to require further stimulation.

http://www.nzherald.co.nz/business/b...thetickercode=

AUD: continues to gain strength

Live mid-market rates as of 2003.06.05 04:50:20 GMT.
1.00 GBP
United Kingdom Pounds = 2.45734 AUD
Australia Dollars
1 GBP = 2.45734 AUD 1 AUD = 0.406944 GBP

Happy days the great money God looks after his own, must up grade the homes I am looking to buy in the UK.




:D :cool: :beer:

Though bear in mind the AUD has already risen 18% this year and when you see that kind of a change, currencies often take a breather before resuming their upward move.

Can remember it dropping 50% in less time, so could be the correction up is now happening.




:D :cool: :beer:

Oh more wonderful news , wonder if Betty will sell me her pad in London, I am feeling well cashed up.

House prices in Australia's capital cities continue to steam ahead but the pace of growth slowed in the first three months of the year.

The House Price Index, issued quarterly by the Australian Bureau of Statistics (ABS), showed an average rise of 3.4 per cent in the March quarter, from 4.8 per cent in the December quarter, and 18 per cent for the year.

:D :cool: :beer: