Aussie dollar falling

raymann

cnocbui wrote: »

I think he's right.

When you talk of historical perspective and look back decades, sure the current high seems like a plateau, but I think what this fails to acknowledge is that Australia has seen a fairly rapid and substantial increase in population over that period and its economy is larger and more substantial.

A lot of the appreciation in the dollar has been on the back of mining investment and demand from China. While China's economy appears to have slowed, somewhat, there is just no way it is going to contract or stall long-term, so the demand for Australian exports is not going to wane - which would be required to justify the dollar slipping back to the sort of historical levels you refer to. The potential for growth in China is enormous and it will happen. Australia's economy is not going back, its going to be dragged along.

The AU/EU just jumped 0.57% in an hour on realisation things were not as dire for the Australian economy as the RBA seems to have been thinking:

http://blogs.wsj.com/economics/2013/11/28/is-australias-economy-sinking-or-swimming/?KEYWORDS=australia

That article talks of mining companies being committed to investing A$240 Billion. For a population of 20 Million that is massive - A$12,000 a head.

Contrast that to Ireland where the Government has to extract about €32,000 from every tax payer to service the bailout.

Speaking of which, I am bemused as to why the Euro is so strong. Greece can't stay in the Eurozone, Spain, Portugal and Ireland are stuffed and when those chooks come home to roost it will be back to the fun times and It would be surprising if the € didn't take a hit.

my issue was with him stating it like it was a fact. theres so many factors influencing currency movement and most of the stiff you have mentioned would have already been priced in. amateurs trying to trade the ups and downs of forex is crazy. playing the bigger picture of all time highs is a much better way of looking at it.

catbear

I agree there's plenty of variables. I have pondered and posted about australias growing reliance upon exports to China and I've often wondered if that try as they might the RBA can't stop China's constant demand putting a floor on the A$.

Then again I know so little about China.

jank

.70 is not a figure that is beyond the scope of being reached again in the near and medium term. We are talking about a 5% increase at the current multi year lows that the AUDEUR is at at the moment. The market is positive on the euro at the moment so eyes are on the USD and other mining heavy currencies. I would just advise people to have a hedge (like I mentioned some posts back regarding the AUDUSD) and not put all eggs in one basket. Tapering was meant to happen in September but the fed are still a long way away from doing this. Interest rates rise will not be good for any debt heavy countries (see Japan as an example) so the US in a bind that they cannot get out of. Historically yes the AUD is high but maybe now is the new normal. We have to factor in facts like China and Western debt, facts that were not there even 5 years ago pre GFC.

I am not telling people what to do but I am personally waiting for it to go well above .70I can wait as I am not going anywhere yet and I have plenty of hedging as well. The days of .80+ are gone unless something exceptional happens to the euro. The Euro cannot survive as it is, so expect more headlines in the coming years. Then is the time to jump IMO.

Batgurl

I'm fully convinced the recent drop is cause all the Irish over here are sending their money home for Christmas

Come January it'll be right back up

the flananator

The dollar has dropped another point.

catbear

I wonder if tensions with China are diminishing A$ safe haven status.

FernandoTorres

There's a chance the AUD will weaken due to slower growth in China, mining investment slowing etc but for the AUD to weaken vs Euro, the Euro has to stay put or strengthen itself. Absolutely nothing has changed in Europe and it's still a mess. Markets are funny and it seems they just got tired of bating Europe for a while. I'm pretty certain there's going to be a big fall in Europe/the Euro at some stage and it's not a question of if but when. The chance of that happening is a lot higher than the chance of China slowing enough for a big fall in the AUD I think.

Again as previously said, there's no point in us amateurs trying to guess the market day to day, best bet is to have hedges in place and it's pretty easy to do if you're willing to do a bit of reading.

ifeelill

FernandoTorres wrote: »

it's pretty easy to do if you're willing to do a bit of reading.

Please enlighten us

FernandoTorres

ifeelill wrote: »

Please enlighten us

I mean read some books to understand how the markets work and what assets you can buy. You can hedge pretty much anything, completely depends on what you're trying to achieve.

For example if you are going home for a holiday, it would be good to periodically transfer cash to Euro rather than trying to time the market and do it all in one go.

If you think things are improving in Europe and worsening in Australia then you could buy some European funds/ETFs to gain exposure rather than trying to time the FX markets.

If you're worried about petrol prices rising, buy an oil ETF, that way while you're spending more on petrol, your ETF will be gaining value.

There are countless other examples.

rightyabe

Going up a bit now, hopefully it gets to .7 at least:/

johnnyfruitcake

Will it rise before the 20th or is it time to get out of the dollar now?

hussey

johnnyfruitcake wrote: »

Will it rise before the 20th or is it time to get out of the dollar now?

If someone can accurately predict the rise and fall of world currency then they should be millionaires, not posting on internet forums :pac:

the flananator

Seems stuck below .66 at the moment, has been for a week. Things looked pretty grim back in July/August and it ended up climbing to .70, so hopefully it will creep back up again in the coming weeks and months.

Timistry

Still slowly dropping and there is a fed meeting next week which will mean a further few cents drop I reckon...

sin_city

Timistry wrote: »

Still slowly dropping and there is a fed meeting next week which will mean a further few cents drop I reckon...

What do you think is going to happen?

I thought nothing of importance was going to happen until March next year.

They'll probably talk about doing something again.

Timistry

sin_city wrote: »

What do you think is going to happen?

I thought nothing of importance was going to happen until March next year.

They'll probably talk about doing something again.

http://www.independent.ie/business/world/europe-sees-a-dip-ahead-of-fed-meeting-29827436.html

I was just looking at this....

On another note, do you think that the market will react to the Irish exit from the bailout, Italy's improving Exchequer figures. Only small fish in a big pond but positive signs none the less.

the flananator

This article is a couple of weeks old now but sheds some light on the situation for the uninformed like myself.

http://www.theaustralian.com.au/business/australian-dollar-slides-anew-as-bears-take-control/story-e6frg8zx-1226769874884

Casts a fairly pessimistic outlook to be honest. Reading that would make a spike back up to .70 seem unlikely anytime in the near future it seems.


EDIT: Bit more optimsitic here;

http://www.smh.com.au/business/markets/currencies/aussie-dollar-will-hold-ground-in-2014-experts-say-20131212-2z8sr.html

catbear

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Legend100

took the hit yesterday myself and sent a chunk home as was fearful of the Fed announcement this week

commited

I've sat on my hands for too long and it seems painful to send money home now, especially considering where it was Looking at the historical against the €, .6-.64 seemed like the usual but I get the feeling that this isn't going to be a soft landing.

On the flip side, scared of a Cyprus style raid on the banks in Ireland!

Bigus

commited wrote: »

I've sat on my hands for too long and it seems painful to send money home now, especially considering where it was Looking at the historical against the €, .6-.64 seemed like the usual but I get the feeling that this isn't going to be a soft landing.

On the flip side, scared of a Cyprus style raid on the banks in Ireland!

You could put your money into old irish Mercs instead of the bank

A_Sober_Paddy

commited wrote: »

I've sat on my hands for too long and it seems painful to send money home now, especially considering where it was Looking at the historical against the €, .6-.64 seemed like the usual but I get the feeling that this isn't going to be a soft landing.

On the flip side, scared of a Cyprus style raid on the banks in Ireland!

Sorry to go off topic, if this was to happen, why on earth would people continue using banks, and not just buy and safe and keep their money in cash at home

commited

Bigus wrote: »

You could put your money into old irish Mercs instead of the bank

Haha, still have my money tied up in one of them too Just no space...

Another thought was that the Fed tapering is already costed in to the current exchange rate and it might stay consistent/improve slightly in the new year..

ballooba

commited wrote: »

On the flip side, scared of a Cyprus style raid on the banks in Ireland!

The bail-in rules only apply to over €100k in any one institution?

Alanhooly

It's obviously not a good time to be sending money home but on the flip side I only have to bring €3,250 with me to Australia to hit the $5,000 mark. It was originally €3,500 so that allows a few extra pints over xmas

Is the current rate expected to fluctuate much in the next 3 weeks would ye think?

Alanhooly

Alanhooly wrote: »

It's obviously not a good time to be sending money home but on the flip side I only have to bring €3,250 with me to Australia to hit the $5,000 mark. It was originally €3,500 so that allows a few extra pints over xmas

Is the current rate expected to fluctuate much in the next 3 weeks would ye think?

In other words, should I send money over now or wait until as late as possible?

AngryHippie

Alanhooly wrote: »

In other words, should I send money over now or wait until as late as possible?

heads or tails mate.
Anyone who tells you they know is full of sh1t.

Preliminary budget report over here was pretty sh1tty.

There is going to be a bit of a trim in govt. spending over the next few years.

catbear

The trend suggests continued weakening, where it settles will take more time to establish. Gov forecast lower ore prices on increased output next year so another leg down in aussie $ is anticipated.

raymann

catbear wrote: »

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this is the only thing that matters. unless you started saving in 2011 you are at worse even. the longer you have saved the more you are still benefitting from this unprecedented all time high.

some of the advice being given out here is just total nonsense broscience economics. the best summary: you have missed the peak of the all time high, but are still cashing out way over the ten year average.

congratulations. seriously.

nice_guy80

Alanhooly wrote: »

In other words, should I send money over now or wait until as late as possible?

set up an online savings account with Rabobank

they are based in Holland

transfer away