Australian dollar

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Emerging markets to sell Australian dollars?

An interesting quote from the AFR this afternoon is worth repeating: For the Australian dollar, the threat from emerging markets softness can be traced back to significant reserve holdings that might be tapped for sale. “Big picture, you still have a pretty clear correlation between the Aussie and Asian central bank reserves, excluding China,” Westpac currency

2

Macro Morning: Gold surges

Gold surged on Friday night to $1396 oz. after the release of some very poor housing data from the US. New home sales were expected to fall in July but only 1.4% so the 13.4% drop was a huge miss and we saw the US dollar and other markets react instantly. Gold is now just

0

Macro Morning: Australia dollar down

Rightyo so the Fed didn’t say anything contentious or unexpected and as David has written this morning in his piece on the Jedi Fed “When the Fed tapers now is really immaterial. The possibility of it is all that matters.” Which of course is dead right and what really hit markets overnight. The key phrase from

11

Safe haven slaughter bloodies Asia

US bond yields spiked again last night, with the 30 year jumping 1% to 3.90 and 10 year jumping up 2% to 2.88%: This is what I’ve been talking about for the past year or so about interest rate normalisation in the US being a problem. Analyst James Aitken puts it nicely: “For the past

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Macro Morning: No safe harbour here

Over the past month there has been a strong divergence in economic release between the G10 (strong), the BRIC’s (weak) and emerging markets (weak but not as weak as the BRIC’s). This data flow has ignited a capital flow away from emerging markets and back toward developed markets as we saw with the strong rally

23

Safe haven slaughter

The talk today in markets is all about the bond outflows that are gathering pace as the US taper looms. Last night US 10 year and 30 year yields both spiked to new highs despite pretty mediocre data: The steepening in shorter term yields is causing all sorts of trouble for emerging markets, which have

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Macro Morning: US dollar confusion

Last night’s price action in the US dollar and sell of in US stocks is dedicated to Frankie Valli. Oh what a night! The USD was strong early after jobless claims fell to an almost 6 year low of 320,000 but the the absolute collapse of the Philly Fed index knocked the dollar from its

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Macro Morning: Australian dollar strength

The Chinese data changed the whole game plan yesterday with the much better than expected outcomes of +5.1% for exports and +10.9% for exports igniting rallies in the Aussie and the commodity bloc currencies, in copper and other global metals and overnight giving a more positive tone to stock markets. Data in Germany though was pretty poor

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Blackrock sees 80 cent dollar

From Bloomie: BlackRock Inc., the world’s biggest fund manager, said Australia’s dollar may drop as low as 80 U.S.cents in the coming nine months after bets against the currency helped give one of its bond funds the nation’s best returns. The strategy profited as the Reserve Bank of Australia cut rates while U.S. yields rose,

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How low will dollar have to go?

UBS is out cutting its Australian dollar forecast to 85 cents: …replacing the lost (domestic) growth from mining capex over the next few years will critically need more than just a moderate housing recovery (which is clearly underway). The economy’s successful transition will need a lift in non-mining capex and activity to both support growth

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Macro Morning: Aussie dollar tanks

Friday was a huge reversal of fortune for the Aussie dollar after the widely reported comments from the Chinese Finance Minister which suggest that growth is going to be lower in the second half of the year. While the debate seems to be raging about whether or not he has downgraded policy I think that

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Return of the King (dollar)

As the US dollar hits a four year high this afternoon, find below a useful note from ANZ on the Return of the King! The market is pushing aside any contrarian USD arguments and focussing on the relativity of central bank forward guidance as the key dynamic in currency markets at present. The dollar has

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Australian dollar smashed on Stevens’ joke

From FTAlphaville this morning: Central bankers can do many things but they should never, ever attempt humour. To illustrate the point we present the price action in the Australian dollar on Wednesday. That’s a three year low of $0.9055 against the greenback and it followed a ‘gag’ from Glenn Stevens, governor of the Reserve Bank