Australian dollar

5

ASX rout resumes: Houses demolished, holes boom

AUD is still strong this morning, partly explained by a falling USD and partly by bullet-proof bulks: Aussie bonds have actually under-performed other nations during the correction. I assume it’s because of the bullet-proof bulks but whatever it is it’s badly misled as the housing crash gathers steam: XJO is down modestly against today: But

3

Westpac cuts Australian dollar outlook

Via Westpac today: AU-US yield differentials have continued to grind steadily in the US dollar’s favour in recent weeks, but the 10 year spread widening in early October was eye-catching, from around -32bp to -50bp. This looked to be a key driver of fresh AUD/USD lows since Feb 2016, near 0.70. Growing concern over the impact on China’s economy of

2

NAB: Australian dollar to break post-GFC low

Via the AFR: The Australian dollar could retest its post-2014 cycle lows below US70¢, according to NAB, amid continuing and potential enduring weakness across emerging markets. …”The message is fairly clear; if we are not out of the woods regarding pressure on emerging markets – not just from the likely scaling up of US tariff

1

Assessing the bull case for the Australian dollar

Via the AFR comes the charge of Aussie dollar bulls: Morgans chief economist Michael Knox expects the dollar to hit US77¢ in the next six months as China ups domestic construction to offset any negative effect of tariffs. …Goldman Sachs Australia and New Zealand chief economist Andrew Boak was the most bullish on the Aussie dollar,

24

Capital Economics: Australian dollar headed to 0.65 cents

From Paul Dales today: “It seems as though the RBA won’t seriously consider raising interest rates until the second half of next year at the earliest,” argues Paul Dales, chief Australia economist at Capital Economics. The Fed might well have hiked two or three more times by then, taking US rates near to three per

30

Would you swap your deflating house for deflating Bitcoin?

Amusing stuff at the AFR: Despite a sharp fall in bitcoin prices over the past eight months, some bullish investors are still willing to accept the cryptocurrency instead of Australian dollars for the sale of their multimillion-dollar homes. …Now with one bitcoin worth $A8786, a prime piece of real estate in Sydney’s inner-city has hit the

5

Dirt rotation accelerates

AUD is up through the morning: Bonds are bid: XJO is struggling to go higher: Dalian is up: And the dirt rotation is accelerating with FMG up as well as 58% iron ore which rallied to six month highs: Big Gas is powering: Big Gold meh: The rotating is out of Big Mortgage as Hayne