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Aussie dollar on the turn

Aussie dollar on the turn

Old Jul 24th 2008, 8:53 am
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Default Aussie dollar on the turn

Patience will be rewarded - taken from Bloomberg this morning. Just wait until post the Bejing olympics slowdown kicks in. Aussie is a little boat in a large ocean and can move quickly when the fundamentals turn.

Commodities Decline

The Australian dollar fell to the lowest in two weeks as Credit Suisse indexes showed traders added to bets for the RBA to reduce its benchmark by 25 basis points in the next 12 months, compared with 11 basis points yesterday.

The currency also weakened as the price of gold, the nation's third-most valuable commodity export, dropped the most in more than six weeks yesterday. Exports of raw materials contribute about 17 percent to Australia's economy.

``For commodity currencies, it appears the writing is on the wall for a sharp pull back,'' wrote London-based Stephen Koukoulas, head of global foreign exchange and fixed-income strategy at TD Securities Ltd., in a research note. ``A weaker commodities outlook will undermine support'' for the Aussie.

New Zealand's government bonds rose, pushing the yield on the 10-year note down 5 basis points to 6.13 percent. The price of the 6 percent security maturing in December 2017 climbed 0.368 to 99.054. A basis point is 0.01 percentage point.

Australian bonds advanced for a second day. The yield on the 10-year note fell 5 basis points to 6.40 percent. The price of the 5.25 percent security maturing in March 2019 gained 0.336, or A$3.36 per A$1,000 face amount, to 91.243.
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Old Jul 24th 2008, 10:14 am
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Default Re: Aussie dollar on the turn

Yeah the GBP was having a nice run up against AUD until those retail sales numbers came out in the UK....now crashing back to earth (along with the retail sales!).
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Old Jul 24th 2008, 10:17 am
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Default Re: Aussie dollar on the turn

Originally Posted by dugongs View Post
Patience will be rewarded - taken from Bloomberg this morning. Just wait until post the Bejing olympics slowdown kicks in. Aussie is a little boat in a large ocean and can move quickly when the fundamentals turn.

Commodities Decline

The Australian dollar fell to the lowest in two weeks as Credit Suisse indexes showed traders added to bets for the RBA to reduce its benchmark by 25 basis points in the next 12 months, compared with 11 basis points yesterday.

The currency also weakened as the price of gold, the nation's third-most valuable commodity export, dropped the most in more than six weeks yesterday. Exports of raw materials contribute about 17 percent to Australia's economy.

``For commodity currencies, it appears the writing is on the wall for a sharp pull back,'' wrote London-based Stephen Koukoulas, head of global foreign exchange and fixed-income strategy at TD Securities Ltd., in a research note. ``A weaker commodities outlook will undermine support'' for the Aussie.

New Zealand's government bonds rose, pushing the yield on the 10-year note down 5 basis points to 6.13 percent. The price of the 6 percent security maturing in December 2017 climbed 0.368 to 99.054. A basis point is 0.01 percentage point.

Australian bonds advanced for a second day. The yield on the 10-year note fell 5 basis points to 6.40 percent. The price of the 5.25 percent security maturing in March 2019 gained 0.336, or A$3.36 per A$1,000 face amount, to 91.243.

Interesting to watch this over the next few weeks. If oil continues to slide I could be persuaded the MPC might keep UK rates on hold, even though a rise is drastically needed.
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Old Jul 30th 2008, 7:49 am
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Default Re: Aussie dollar on the turn

Another article picking up on the possible reversal of aussie dollar. Good news for those with funds although bad news for those that need to find work when you get there. Aussie recessions are brutal given the low margin nature of the economy and costs are slashed hard.

http://www.telegraph.co.uk/money/mai...30/cnoz130.xml
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Old Jul 30th 2008, 7:57 am
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Default Re: Aussie dollar on the turn

this is definately good news for people transfering their funds to OZ , still a russian rullette end of the day, do you hold out and hope you get more for your ponds or do you send the funds over.
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Old Jul 30th 2008, 8:20 am
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Default Re: Aussie dollar on the turn

Originally Posted by dugongs View Post
Another article picking up on the possible reversal of aussie dollar. Good news for those with funds although bad news for those that need to find work when you get there. Aussie recessions are brutal given the low margin nature of the economy and costs are slashed hard.

http://www.telegraph.co.uk/money/mai...30/cnoz130.xml
I read this article earlier and I think most of it is a load of crap. 'The Aussie's going down big time' it states. Well, the AUD has gone from 0.98 to the USD to 0.95 in a week. Big drop that. Some of the banks have taken some big hits but i bet most of them still make billion $ profits this year - $2-3b compared to $4b for instance. Coal, iron-ore, LNG and food prices are, mostly, still at record highs. Many new resource projects are coming on-stream this year - causing a huge increase in royalties flowing to Canberra and the states. Queensland, WA and NT are still booming.

I think the Telegraph is having a slow news day.

Last edited by Amazulu; Jul 30th 2008 at 9:03 am.
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Old Jul 30th 2008, 8:41 am
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Default Re: Aussie dollar on the turn

Originally Posted by ozzierules View Post
this is definately good news for people transfering their funds to OZ , still a russian rullette end of the day, do you hold out and hope you get more for your ponds or do you send the funds over.
Be careful what you transfer to Australia. The Australian government does not guarantee funds like the US and UK govts do. If there's a run on a bank you could lose the lot.

I don't share your optimism, Amazulu. I think the over-valued Aussie property market is about to get what's coming to it.
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Old Jul 30th 2008, 9:09 am
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Default Re: Aussie dollar on the turn

Originally Posted by Tableland View Post
I don't share your optimism, Amazulu. I think the over-valued Aussie property market is about to get what's coming to it.
Maybe, maybe not, but this article is totally pessimistic about the whole Australian economy and I do not share that view at all.
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Old Jul 30th 2008, 9:22 am
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Default Re: Aussie dollar on the turn

]
Had no choice but convert/xfer a chunk before recent rise...grrr
The chart shows sideways movement now in the 2-02 -209 range, if breaks through the 2-10 barrier could be on an upward trend. Cant seem to do this at the momment tho.

Hmm
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Old Jul 30th 2008, 10:25 am
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Default Re: Aussie dollar on the turn

Originally Posted by Tableland View Post
Be careful what you transfer to Australia. The Australian government does not guarantee funds like the US and UK govts do. If there's a run on a bank you could lose the lot.

I don't share your optimism, Amazulu. I think the over-valued Aussie property market is about to get what's coming to it.
The CEO of National Australia Bank said something interesting the other day about Australian property prices along the lines that, yes, property is very expensive in Australia but, unlike the US, there isn't an over supply of housing. To put it simply, too many houses were built in the US. This, combined with crazy lending to people who were guaranteed to default means the US is in a much more difficult situation. Strong immigration and the mining boom means many of the overseas pundits have got it wrong when they predict Australia will follow the US down the negative equity gurgler.

The fact is the Australian economy has been (and is) much better managed than the US one. Aus has a budget surplus around 2% of GDP while the US has a 3 % deficit which is more like 4% except they don't count their "war deficit". Talk about shonky book-keeping.
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Old Jul 30th 2008, 11:23 am
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Default Re: Aussie dollar on the turn

>>The CEO of National Australia Bank said something interesting the other day about Australian property prices along the lines that, yes, property is very expensive in Australia but, unlike the US, there isn't an over supply of housing. To put it simply, too many houses were built in the US. This, combined with crazy lending to people who were guaranteed to default means the US is in a much more difficult situation. Strong immigration and the mining boom means many of the overseas pundits have got it wrong when they predict Australia will follow the US down the negative equity gurgler.<<

Half yes: half No!

He's right in that there's no surplus of property - partly because of immigration - but the other side of the equation is whether people are able to actually *afford* the recent rediculous prices asked. More and more are finding they cannot, and more houses are being reposessed, driving the remainder down in a spiral. Not in all places, but I don't think we've seen the last of it by a long chalk.
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Old Jul 30th 2008, 11:39 am
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Default Re: Aussie dollar on the turn

Originally Posted by Budawang View Post
The CEO of National Australia Bank said something interesting the other day about Australian property prices along the lines that, yes, property is very expensive in Australia but, unlike the US, there isn't an over supply of housing. To put it simply, too many houses were built in the US. This, combined with crazy lending to people who were guaranteed to default means the US is in a much more difficult situation. Strong immigration and the mining boom means many of the overseas pundits have got it wrong when they predict Australia will follow the US down the negative equity gurgler.

The fact is the Australian economy has been (and is) much better managed than the US one. Aus has a budget surplus around 2% of GDP while the US has a 3 % deficit which is more like 4% except they don't count their "war deficit". Talk about shonky book-keeping.
There is no over supply in the UK either but prices are still plummeting as people are not buying. This problem has got many causes and just because one does not apply in a particular country it doesn't mean that the same outcome will not occur.
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Old Jul 30th 2008, 12:29 pm
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Default Re: Aussie dollar on the turn

The Australian dollar fell to the lowest in two weeks as Credit Suisse indexes showed traders added to bets for the RBA to reduce its benchmark by 25 basis points in the next 12 months, compared with 11 basis points yesterday.
Is this what I sound like when I talk to people about cross-platform Optimistic Concurrency strategy implementations for NHibernate Object Relational Mapping ?
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Old Jul 30th 2008, 1:14 pm
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Default Re: Aussie dollar on the turn

Just do what i do, any spare cash, buy Gold ..........mm
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Old Jul 30th 2008, 1:59 pm
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Default Re: Aussie dollar on the turn

Originally Posted by dugongs View Post
Another article picking up on the possible reversal of aussie dollar. Good news for those with funds although bad news for those that need to find work when you get there. Aussie recessions are brutal given the low margin nature of the economy and costs are slashed hard.

http://www.telegraph.co.uk/money/mai...30/cnoz130.xml
what a rubbish article...

"The retreat comes days after the Melbourne lender shocked the markets by announcing a 90pc write-down on its £550m holdings of US mortgage debt, an admission that it AAA-rated securities are virtually worthless."

Yet, it fails to mention that NAB's total assets are over $500bn !!!

This is the equivalent of you or I losing a couple of grand in the casino....and it is being held up as evidence in an article entitled "australia faces worse crisis than usa" !!! heh heh....
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