AUD short term instability

Topherclaus

Topherclaus

Active Member
Any opinions on the thought it might be worthwhile parking some $$ in another currency for this week or 2 following such a tight election result? A hung parliament could definitely cause a drop in the dollar, but where would you? And what platforms are best for currency trading?
 
I think the AUD will take a hit from the election uncertainty but it's too late to really take advantage of it.

I'd be parking money in the British Pound (risky) or Swiss Franc (safe, but less upside) if I was worried about future AUD weakness.

Currency Fair is the best I've seen for foreign exchange at a decent rate.

http://www.currencyfair.com/
 
I am very surprised that the AUD hasn't taken a hit today.

If Labor gets government it should be down. Or with unstable and weak minority Liberal government I wouldn't imagine investors would be too happy either!!

Surely the market was expecting a Liberal victory and improvements to company tax rates....that are now next to ZERO chance of happening. Is the market slow to price this in?
 
I just converted a huge amount of AUD to USD for business. I figure the downside is more probable than further upside at this point.
I use https://www.currencyfair.com/
You can leave the money sitting in their account in any currency for as long as you want, and transfer instantly (if markets are open). Rates are the best I've found.
 
Relative high AAA interest rate.

Institutions, pension funds and soveriegn funds around the world looking for safe haven, bearing in mind there are parking trillions in zero to negative interest even the paltry interest Australian government bonds will look great.

Unlike most memebers, I'm of the view Australian Governement should borrow borrow and invest in infastrure when the interest rate is low, so when the world economy bottoms out and start to go back to normalcy, we can benefit from infrastructure investment cost negligible interest.
 
Looks like the AUD is about to fall off a cliff. Mean while the RBA still think they can keep the cash rate at 1.5% haha :p i guess they are screwed either way. The RBA is a waste of tax money, they are worse then useless.

aud fall.jpg
 
There are many reason for the AUD to drop.

-Falling housing market
-No wage growth
-Record consumer debt
-Emergency low interest rates
-Falling consumer confidence
-Incompetent government
and the list goes on...
 
As predicted the AUD had a sharp fall today. Got down to 68.5c. This is just the start...
 
The AUD is also one of the most traded and volatile 1st world currencies (from memory 7th most traded currency on the planet) due to the resources nature of the country...BTW I don't discount inept govt or RBA policy driving AUD trading price either but I think macro issues such as forward FX purchases (lack there of due to slowing USD dominated resources sales in 2019) or potential for a rate cut (refer leo25) maybe more the driving factor.

It's great seeing the AUD gold price spike a tad due to the decline of the AUD, but I'd prefer to see a bigger upward spike in the USD gold price but I'll take it anyway.

The AUD is only really returning to it's natural trading range which I've started at 1984 given the AUD was only floated in mid Dec 1983. For those who care to dig a bit, you'll be surprised at where the AUD used to be pegged against the USD100 year prior.

imggraph.php

http://fxtop.com/en/historical-exchange-rates.php?A=1&C1=AUD&C2=USD&TR=1&MA=1&YA=1&DD1=01&MM1=01&YYYY1=1984&B=1&P=&I=1&DD2=03&MM2=01&YYYY2=2019&btnOK=Go!

For those of us old enough to remember the "golden years" (aka Howard), post Sept 2001, the AUD fell below USD50c and the Aust ecomony kicked on nicely...and this was pre the resources boom.
 
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Oddjob said:
It's great seeing the AUD gold price spike a tad due to the decline of the AUD, but I'd prefer to see a bigger upward spike in the USD gold price but I'll take it anyway.
Click to expand...

Yep, it's a nice gain, but being in a business that buys stuff in USD, I get hit on the other side of the coin as a result.

The AUD is only really returning to it's natural trading range which I've started at 1984 given the AUD was only floated in mid Dec 1983. For those who care to dig a bit, you'll be surprised at where the AUD used to be pegged against the USD100 year prior.
Click to expand...

I was getting used to be it being fairly stable around the 70-80c mark. I wonder if/when there will be a wild breakout again?
 
SilverDJ said:
Yep, it's a nice gain, but being in a business that buys stuff in USD, I get hit on the other side of the coin as a result.


I was getting used to be it being fairly stable around the 70-80c mark. I wonder if/when there will be a wild breakout again?
Click to expand...

Only generally if 1) price for USD dominated receivables increases ie coal, iron ore etc with Aust sellers having to convert back to AUD thus pushing the AUD price up or 2) the Aust interest rates exceed the USD for a decent margin and investors pile in for the return.

Safe haven reasons for buying Aust securities (which can push up the AUD value) could be thrown out the window if Little Bill resides in the lodge, plus he'll sign a deal with the devil in need (aka Greens) to secure power and that means our coal industry is done for....our number on export product. Should this come to pass...

 
^ yes it was
when came the 80's the currency depreciated with 25% discount, many OZ traveling overseas got hit
and the Japanese who put their money in OZ banks, also had it

from 1.50 to 50 cents that was wild
 
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