Australian dollar

21

Henry says high dollar to Hell and back

From AAP: Former treasury boss Ken Henry has told business the Australian dollar is likely to remain high for the foreseeable future. Dr Henry told the Australian Industry Group forum in Canberra it would not be prudent to bank on an early sizeable depreciation in the exchange rate. “There is no silver bullet that is

68

Cut rates for a lower dollar

That’s the argument made by many MB commenters and today by Westpac’s Huw Mackay (of Phat Dragon fame)  at the AFR. …the most recent balance of payments data show that gross foreign purchases of Australian assets were 42 per cent debt and 58 per cent equity. Westpac proprietary customer data shows that foreign sovereign purchases

49

China stamps Australian dollar with reserve currency status

Here’s something MB missed yesterday (as did the entire Australian press) and may in part have triggered the McKibbin story overnight. From Alphaville: SYDNEY-Officials within the foreign-exchange arm of China’s central bank recently met Australian regional governments to discuss buying their bonds, people familiar with the matter said. The securities – known as semi-government –

93

McKibbin urges RBA to force down Australian dollar

By David Llewellyn-Smith Thank heavens. Australia’s best free-thinking economist, Warwick McKibbin, has finally broken the Canberra consensus and urged the RBA to sell the dollar. From the AFR: Former Reserve Bank of Australia board member Warwick McKibbin is urging the central bank to intervene in currency markets to limit the strength of the dollar, suggesting

22

Central banks piling into Australian dollar

From the WSJ: Germany’s Bundesbank is expected to begin adding Australian dollar assets such as government bonds to its foreign reserve holdings before the end of September, bankers say. The decision, which follows a two-and-a-half year review by the Bundesbank, adds to a wave of central bank demand for Australian-dollar exposures that has swelled over

11

Czechs buy Australian dollars

In more poor news, the AFR reports that: The Czech Republic central bank is buying Australian dollars for inclusion in its foreign exchange reserves. …According to one trader, the Czech National Bank has been buying Australian dollars in the 2012 calendar year of amounts that add up to between $US500 million and $US1 billion. Let’s

11

Carrying the Euro

The great conundrum of FX markets over the past year or two has been the resilience of the Euro in the face of all the problems that have engulfed the Eurozone, seemingly threatening its very existence. We know that European banks have been repatriating money and we know that both legs of Chairman Bernanke’s quantitative easing

9

Australian dollar resilience

Find below a fascinating new note from Westpac’s Huw Mackay (Phat Dragon), who has a brain the size of a planet, on why the Australian dollar has  shown continued resilience, even though, thankfully, he does not buy into the “safe haven” tripe: We principally highlight the economy’s improved external financing position (both in terms of scale

16

Australian dollar squeeze underway

You might be asking the question: how can the Australian dollar be back above parity after a night where Spanish and Italian yields blew out and only a couple of days before the Greek election? Anyone who tells you that this is because the Aussie dollar is a safe haven should faded quick smart. The

8

Australian dollar rally and reversal

Ben Bernanke stole the punch bowl for commodities and commodity currencies last night, which had rallied on the back of the Chniese rate cut and freeing up of deposit and lending rate controls. But with his usual equanimity, the Fed Chairman simply didn’t want to play ball and add more stimulus and markets were not happy

29

Australian dollar bounce?

As I write the Australian dollar is up 0.62% to 0.9819 after making a low last week around 0.9690. Indeed the Aussie has, ever so slightly, broken through the top of the hourly downtrend channel it has been in since the run toward 1.05 in late April. Now it’s only 6.30 on a Monday morning,

22

Australian dollar to 90 cents?

As a mate of mine just said to me – the Aussie dollar looks like a lead canoe this morning and my thoughts on it heading below parity remain undiminished. Here is the chart of how it looks at present and nothing in the fundamental outlook has changed from the piece I wrote the other

19

Australian Dollar Valuation Report

The Australian Financial Review had its annual “Power Issue” a couple of weeks ago. It’s the usual who’s who in wielding both overt and covert power. But, as we all know, power doesn’t just reside in individuals. There are external factors or influences beyond even the most powerful person’s grasp. The Arab Spring and the nascent

21

Australian dollar: Give us a minute!

Today sees the release of the RBA minutes from this month’s Board meeting and there is a really strong chance that shortly after their release at 11.30 (EDIT previously I wrote 2.30pm) rates are a little higher than where they are this morning. Yesterday I was talking to an old colleague about the rally in interest