Australian dollar

14

Australian dollar becomes one way bet: up

Aussie GDP was terrible today with absolutely nothing growing beyond a few bureaucrats, via Westpac: Key surprises were: (1) consumer spending disappointed, 0.3% vs a f/c 0.4%; (2) ownership transfer costs (relating to real estate turnover) fell very sharply, -13%; and (3) inventories were a negative, -0.1ppt vs a f/c flat ~ suggesting a larger

39

When crisis strikes, US dollar is king

Via Michael Every at RaboBank: There are lots of theories about what factors drives FX markets: interest rate differentials; real interest rate differentials; central bank actions like QE; real effective exchange rates; ‘fair value’; the fiscal deficit; the current account deficit; capital flows; speculation; sentiment; and technicals. (Add your own if I missed one.) Of

11

ANZ: Australian dollar headed to 0.65 cents

Via ANZ: The Australian dollar’s recent leg down has pushed it below USD0.70 – that is, below the trough we forecast for this cycle. The global outlook has deteriorated sufficiently that it no longer provides a plausible cushion to the inevitable reduction in domestic rates. As such, we have lowered the trough in our forecast

69

Westpac: 3 rate cuts to push Australian dollar to 0.66 cents

Via Bill Evans at Westpac: Earlier this week Westpac moved forward its forecast for RBA cash rate cuts from the original forecast on February 21 of cuts in August and November to June and August. The June cut remains almost certain; a second in August is our expectation and the November cut should also proceed.