Aussie dollar falling

Timistry · 10-09-2014 12:35pm

Lost 2 cents in as many days...

sin_city · 11-09-2014 2:43am

All gets back to facts despite what bull they do to try to talk the Aussie dollar down and other currencies up.

They say there is "talk" of a rate rise in the US....bull...that was driving the AUD down.

Anyway, jobs report today shows the Australian economy added 121,000 jobs in August and the dollar is going up again.

Anyway, it's going up from 70 cents to 71 and maybe 72....I think this is a good range to consolidate....If it rockets up too fast it can rocket back down just as fast.

catbear · 11-09-2014 4:56am

sin_city wrote: »

Anyway, jobs report today shows the Australian economy added 121,000 jobs in August and the dollar is going up again.

For how long? Those added jobs didn't stop unemployment increasing.

sin_city · 11-09-2014 5:40am

catbear wrote: »

For how long? Those added jobs didn't stop unemployment increasing.

Yes they did...People we expecting 15,000 new jobs not the huge 121,000 number.

The unemployment rate fell to 6.1%, from 6.4%.

Next.

catbear · 11-09-2014 6:01am

sin_city wrote: »

Yes they did...People we expecting 15,000 new jobs not the huge 121,000 number.

The unemployment rate fell to 6.1%, from 6.4%.

Next.

I'm skeptical of those figures as the ABS changed their survey group. Just to reiterate the ABS defines employed as

worked for one hour or more for pay, profit, commission or payment in kind, in a job or business or on a farm (comprising employees, employers and own account workers)

I'll be interested to see if the next Roy Morgon survey matches the ABS.

sin_city · 11-09-2014 7:20am

Do you prefer the US's measure of unemployment?

If we are comparing the Australian economy to other western economies I think the Australian one is far better.

Anyway, the Aussie dollar is hovering about 71 cents....I think most people would have taken that 6 months ago.

IF you think Europe's economy is about to boom you would maybe back the Euro getting stronger versus the AUD...I don't think this will happen.

mandrake04 · 11-09-2014 10:46am

catbear wrote: »

I'm skeptical of those figures as the ABS changed their survey group. Just to reiterate the ABS defines employed as

What's changed? The link you provided was last updated 30 Nov 2006, where does it say that the unemployment yard stick has changed recently?

catbear · 11-09-2014 12:01pm

mandrake04 wrote: »

What's changed? The link you provided was last updated 30 Nov 2006, where does it say that the unemployment yard stick has changed recently?

They change their survey group regularly, i'll get a link to the most recent survey when i'm near a computer again.

Edit to add: Well it's all over the media today, Aus dollar bounce wiped out as long term trend in unemployment unaffected. Survey noted more part time jobs but overall hours worked unchanged.

colman1212 · 16-09-2014 3:47am

http://www.brisbanetimes.com.au/business/the-economy/rba-needs-to-address-australias-property-bubble-ubs-20140916-10hex2.html

Thought this was interesting, they want to see the AUD$ hit below US$.85

sin_city · 16-09-2014 5:58am

colman1212 wrote: »

http://www.brisbanetimes.com.au/business/the-economy/rba-needs-to-address-australias-property-bubble-ubs-20140916-10hex2.html

Thought this was interesting, they want to see the AUD$ hit below US$.85

This is an example of what has changed. People are again trying to talk the Aussie dollar down and for the moment it is working.

A few things:

For some reason people are saying the US interest rates will be increased soon. Ok, so they are 0% at the moment which means servicing the debt overall is on average at 6.23 of federal outlays or nearly $223 billion USD:

Everyone must know that the US economy is a mess and if you think the figures are being massaged here Australia then you'll be blown away by the Americans.

So, if the interest rates rise in the US a tiny bit...what do you think that will mean for interest costs on the nearly $18 trillion USD debt.

They can't raise interest rates and if they did they'd be in severe recession, a lot worse than before.

The US dollar will become less and less relevant and eventually the US won't be able to finance it's deficit spending at the expense of the rest of the world via their reserve currency status.

Argentina and China are the latest countries to agree to bypass the dollar.

So, while they are blabbering on about US increases in interest rates in the press they will never state the consequences of this happening.

Either way, Australia is in a far better position than Europe and the US so while these attacks on the strength of the dollar do have an effect on the strength of the AUD (it has been pummeled down so fast) personally I think in the long term it will get back to where it was versus both USD and EUR in the long term.

No Username Yet · 16-09-2014 6:18am

isn't it at an unusual high though, €1 was equivalent to 2 Aussie bucks when I was there

catbear · 16-09-2014 6:45am

No Username Yet wrote: »

isn't it at an unusual high though, €1 was equivalent to 2 Aussie bucks when I was there

That was a period of extreme volatility that was reversed by a combination of money printing in the US and stimulus spending by China.

The A$ will also see its strength sapped by easier ways to directly invest into China.

statina · 16-09-2014 6:46am

sin_city wrote: »

This is an example of what has changed. People are again trying to talk the Aussie dollar down and for the moment it is working.

A few things:

For some reason people are saying the US interest rates will be increased soon. Ok, so they are 0% at the moment which means servicing the debt overall is on average at 6.23 of federal outlays or nearly $223 billion USD:

Everyone must know that the US economy is a mess and if you think the figures are being massaged here Australia then you'll be blown away by the Americans.

So, if the interest rates rise in the US a tiny bit...what do you think that will mean for interest costs on the nearly $18 trillion USD debt.

They can't raise interest rates and if they did they'd be in severe recession, a lot worse than before.

The US dollar will become less and less relevant and eventually the US won't be able to finance it's deficit spending at the expense of the rest of the world via their reserve currency status.

Argentina and China are the latest countries to agree to bypass the dollar.

So, while they are blabbering on about US increases in interest rates in the press they will never state the consequences of this happening.

Either way, Australia is in a far better position than Europe and the US so while these attacks on the strength of the dollar do have an effect on the strength of the AUD (it has been pummeled down so fast) personally I think in the long term it will get back to where it was versus both USD and EUR in the long term.

Do you think it will stay at 69 for a while or can you see it rising to 70/ 71 in the near future? Annoyed I didn't transfer more when it was 71!

No Username Yet · 16-09-2014 7:07am

catbear wrote: »

That was a period of extreme volatility that was reversed by a combination of money printing in the US and stimulus spending by China.

The A$ will also see its strength sapped by easier ways to directly invest into China.

None the less it is unusually high (historically) anyway, yes world markets (China) has impacted all currency values

cnocbui · 16-09-2014 9:56am

No Username Yet wrote: »

None the less it is unusually high (historically) anyway, yes world markets (China) has impacted all currency values

When people go on about 'historical' values they are talking last century - literally. It's as if you are supposed to believe nothing fundamental has changed in Australia over the last 20 years or in the external world, like population growth, changes in world demand and the tapping of new commodities like LNG.

See, nothing's changed, let's put the AU$ back at US 0.73 where it belongs.

catbear · 16-09-2014 11:33am

cnocbui wrote: »

See, nothing's changed, let's put the AU$ back at US 0.73 where it belongs.

Maybe it regain it's old nickname, the Pacific Peso!

Alanhooly · 16-09-2014 11:44am

I know nobody here is a fortune teller but what would the general concensus be, transfer money back now or give it 2 months longer?

Is it likely to consolidate at 69/70c?

jank · 16-09-2014 12:15pm

Now long is a piece of string? Nobody knows exactly what is going to happen but the can give you advise to mitigate risk. Maybe do half now and a half in two months. I did mention last week when the AUDEUR was over .72cents that people would be wise to get a forward contract.

cnocbui · 16-09-2014 12:42pm

Have a look at an exchange rate graph for the past 6 months and take a guess?

There 'seems' to be a steady upward trend to my eyes - not withstanding the inexplicable recent plunge of nearly 3 cents in just a week.

Hang on, I'll just do a quick scientific experiment ... heads ... it might go up.

Then again...

catbear · 16-09-2014 1:14pm

cnocbui wrote: »

Hang on, I'll just do a quick scientific experiment ... heads ... it might go up.

Then again...

Reminds me of......

cnocbui · 16-09-2014 2:27pm

Lol - that is spot on.

You read some news and one article says iron ore prices have just jumped, another says the RBA model wants the dollar to be worth less than it is to achieve their desired outcomes so a rate cut is possible, but not at the moment, other economists nod their heads in wise agreement that true value is 0.85 but caution they expect to see 90-91 by Dec then another article pretty much says the RBA is concerned at a housing market bubble in Oz so they can't cut rates and may have to raise them.

And these opposing predictions/views on what the RBA can/will/might do are in the same paper within 24hrs of each other.

sin_city · 17-09-2014 12:04am

statina wrote: »

Do you think it will stay at 69 for a while or can you see it rising to 70/ 71 in the near future? Annoyed I didn't transfer more when it was 71!

Its back at 70 today....Anyone else notice the extreme amount of volatility?

Let's hope it just sticks around 70 for a while

catbear · 19-09-2014 9:50am

The next two weeks could be interesting. Continued decline in demand for Iron ore from China may give us a drop in the Aus$. I'm glad I got a chunk away at .72 but on the up side if you're buying Aus$ it may be worth holding off. Watch for the Iron ore price.

catbear · 23-09-2014 5:12am

The slowdown in China and a tighter federal budget will pull Australia's growth down to as low as 2 per cent next year, prompting interest rate cuts and a 20 per cent slump in the value of the Australian dollar, a prestigious global forecaster says.

Read more: http://www.smh.com.au/business/the-economy/dr-doom-nouriel-roubini8217s-firm-warns-of-20-australian-dollar-slump-20140922-10kc2e.html#ixzz3E6mMaJJF

Meanwhile Iron Ore dropped below $80 and this years gains on the ASX are gone.

sin_city · 31-10-2014 3:02am

Aussie dollar back above 70 cents

Alanhooly · 25-11-2014 9:32am

Starting to drop a bit now. Just when I hoped to transfer it home. It's gone from 0.6972 to 0.6836 in 24 hours on currencyfair.

niva*sis · 26-11-2014 3:46am

it was 70 on Monday...

braddun · 26-11-2014 4:11am

the usa dollar is going up so buy that rather than euros

Alanhooly · 26-11-2014 6:56am

Does anyone know or can anyone predict if this downward trend will continue?

Not sure whether to cut my losses and transfer now or wait and see if it creeps back up

Peregrinus · 26-11-2014 8:50am

Alanhooly wrote: »

Does anyone know or can anyone predict if this downward trend will continue?

No. Nobody knows.

If they did they wouldn't be faffing around on discussion boards like this. They would be fully occupied managing the billions of dollars of assets that they would have acquired through their ability to predict future exchange rate movements.

Alanhooly wrote: »

Not sure whether to cut my losses and transfer now or wait and see if it creeps back up

Depends. Are your current liabilities measured in Euros? Do you expect your future expenditure to be incurred in Euros?

If the answer to these questions is "yes" then the choice facing you is basically this:

A. I want to gamble on the toss of a coin. I'll hold assets in AUD and take my chances on the prevailing exchange rate when I switch to EUR to meet my liabilities/incur my expenditures. Whether the exchange rate goes up or down in the future - and, from here, each outcome is equally likely - I'll be better off, because I'll have had the satisfaction of making a wager than I want to make.

B. I don't want to gamble. I'll match my assets to my present and future liabilities by converting AUD to EUR now. Whether the exchange rate goes up or down in the future - and, from here, each outcome is equally likely - I'll be better off, because I'll have avoided a risk which I don't wish to be exposed to.

In other words, the question you should be asking yourself is not whether the exchange rate will go up or down in the future. That's a mug's game. The meaningful question is whether you wish to take a risk from which you are equally likely to gain or lose, or to avoid the risk and any possible gain or loss. It's your attitude to risk that needs to be identified, not the future movements of the AUD/EUR exchange rate. And of course the only person competent to determine your attitude to risk is you.

Aussie dollar falling

Comments