Trade boom lifts Australian dollar

The Australian dollar has lifted from the canvas this morning on Australia’s epic commodities trade surplus:

Bonds are still bid as retail failed:

XJO is running wild as the asteroid approaches:

Dalian is soft again:

Big Iron bashed as Rio  goes ex-div:

Big Gas is soft with oil:

Big Gold is trying. Still not a fan:

Banks continue to climb on the yield trade:

Indeed, everything interest rate sensitive is up today:

‘Tis a strange world in which markets bull up on collapsing domestic demand.

Comments

  1. Funny….. one minute down and next minute up. When I see MB Headlines about AUD down or whatever I know its only a matter of time till the next head MB Headline AUD takes off……

  2. ‘Tis a strange world in which markets bull up on collapsing domestic demand.”

    Is this even really true ?
    Seems like there is a large demand for AUD to pay down domestic debt, and a lack of new supply as fewer AUD loans being created

    Does anyone have an opinion on this ?

    • BrentonMEMBER

      Appears to be borne out by broad money:
      https://www.rba.gov.au/chart-pack/credit-money.html

      But why would that be bullish for equities? I would’ve thought that if debt is being paid down, cash/credit is not being directed toward equities, but is instead being destroyed by the debt deleveraging. In fact, any such deleveraging would be partly coming from the liquidation of other assets (including stocks), a bearish signal for equities.

      • Yeah could be chase for yield with no regard for capital value over the longer term… hello, recession looming!.

        The opposite to housing specufestors!

      • Brenton it’s not what make markets move
        I said few months ago that 5500 around low and we would head back to 7000
        Think we may even see towards 10,000 in this cycle
        Forget PE it’s capital chasing return
        The crash on 08 was equities
        Crash now is property not equities

      • While MB and everyone else is calling asx crash it’ll keep going up
        Looks like the next bubble to me.
        My feeling at 8,000 plus we will start talking bubble in equities
        Markets are irrational and emotional
        Take the logic out

      • BrentonMEMBER

        Strip the asset class out of it (just happens to be property), this a debt crisis we’re going into. No debt crisis involves a rally in equities. Anyone not forced into a state of deleveraging will go into a capital preservation mode. Flight to safety trades, not a flight to risk.

        After the crash, then will come QE and your likely bull market to all time highs.