Down goes the AUD again. But any weakening in the US will again strengthen the AUD and we'll be doing this all over again at some future RBA decision time. For countries like Australia that are stifling economic growth and attacking the core of innovation, there's not much else that can be done than to keep weakening the currency, hold your balls and hope for the best. Not a great plan.
An opinion that we won't see an AUD crash. David Plank, Deutsche Bank's Sydney-based macro strategist:
Interesting thanks SilverPete. I've been pondering for a while that the "currency crash" is a "US Dollar-centric" construct, and all the doom and gloom is to do with the US dollar and its associated issues. Coupled with this is the see-saw effect of USD down - gold/AUD up, giving us a quite orderly rise and fall in gold and the associated stability. This is not a prognostication but it's good to see a reasonable voice in the 'we're all gonna die' debate.
minor news compared to what is coming down the pipe for Europe. expect a very short term drop before it resumes its upwards climb. 3 days is a long time in finance.
A good time to cream a little more from the doomsayers waiting for the crash in the U.S. dollar. "Look, we were right, it's crashing....lets short it like there's no tomorrow.." As those little Whammies would say...." I wanna take a photo of you losing your money..."
The australian guy Darryl something, the australian repeat guest chart analyst on CNBCs street signs Asia thinks that resistance for the aussie is all the way up at. 78 cents even though the long term move is down. The RBA is in a hell of a bind, rates go down to get the aussie under .70 for exports and the acknowledged housing bubble goes white hot. Raise rates and housing pops and the dollar goes up killing whatever exports we have left. A few famous australian economists would say then you need inflationary policy that doesn't impact interest rates...HELICOPTER MONEY FOR EVERYONE!!! I'm gonna buy PMs but still you get the dollar down and you can slow down the housing prices by keeping rates on a slow slow upward trajectory. Australia has form on helicopter money, it didn't do a crappy job and everyone got new TV's. Hard to pretend that it wasn't 22 year old FIFO miners thinking the good times would never end buying home theater systems and a spare dirt bike for when company comes around didn't save Australian consumer spending numbers during the GFC, but that $900 helped and who doesn't want some money printing for us instead of for big banks?
Rubbish. Wasn't a problem when the dollar was on parity or over a for a few years. I say raise the damn rates and let the dollar go back up.
It isn't a problem when iron ore prices are 300% higher, it's not a problem when European competitors are much much cheaper, vina as well and it's only Japan that's more expensive. I'm all for higher aud, I gotta buy greenbacks, but stable and a little lower is what SMEs want. I know for my little project lower aussie is very very helpful when things actualy start happening.
The currency wars are really heating up aren't they? At this rate we're going to need to cut rates here in the next month or so or we'll hit 80c
