AUD 02 (Feb 12 - Dec 20)

Re: AUD 02 (Feb 12 - Dec 17)

Postby winston » Fri Feb 24, 2017 8:09 am

Debt risks too high for rate cuts: RBA

Cutting interest rates to marginally boost employment is not worth the risk of encouraging more household debt, the head of the Reserve Bank says.

Governor Philip Lowe has told a parliamentary economics committee debt is already rising much faster than household income.

A further rate cut would likely push household debt higher to fund home purchases and investment.

"Is it really in the national interest to create a little bit more employment growth in the short-run at the expense of creating vulnerabilities that could be quite dangerous in the long term," Dr Lowe told the hearing in Sydney on Friday.

"I accept that different people will come to different points on judging that trade-off, but at the moment we're in a reasonable place."

Source: AAP
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Re: AUD 02 (Feb 12 - Dec 17)

Postby winston » Wed Mar 01, 2017 12:19 pm

Aussie Dollar Firms: Australia In A Mini Mining Boom?

By Shuli Ren

Two pieces of data are working in the Aussie’s favor today.

First, the Australian economy grew at a 2.4% year-on-year pace in the fourth-quarter, better than expected 2% and the third-quarter’s 1.8%.

Second, China’s official manufacturing PMI came in at 51.6 in February, better than a 51.2 reading expected by the street and January’s 51.3.

A stronger economy in China boosts demand for Australia’s commodity exports, such as iron ore. A stronger Australian economy, in turn, enhances the attractiveness of the Aussie.


Mining investment actually rose for the first time since 2013, by 1.3% q/q.

Coming alongside a 1.2% q/q rise in dwellings investment, private investment rose for the first time in two years.




Source: Barron's Asia

http://blogs.barrons.com/asiastocks/201 ... on-upside/
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Re: AUD 02 (Feb 12 - Dec 17)

Postby winston » Thu Mar 02, 2017 11:27 am

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Aussie Dollar Slips as Trade Surplus Narrows Sharply

By Shuli Ren

The Australian dollar was pressured on Thursday morning, down 0.2% against the U.S. dollar, after Australia’s trade surplus surprised on the downside.

In January, Australia’s trade surplus fell to 1.3 billion Australian dollars versus December’s A$3.3 billion.

Total exports fell 2.9% from December.

Barclays explains:
The ongoing recovery in exports remains dependent on buoyant commodity prices. However, the recent sharp decline in coking coal prices raises some concerns over its sustainability.

In January, we saw some reversal in mineral exports, with iron ore, coal, and gold reporting sharp m/m declines.

Non-rural goods exports, which cover the bulk commodities, fell 2% m/m, with shipments to China declining at the margin. Services exports were largely stable, and LNG shipments improved slightly.

The latest RBA commodity price index is showing signs of thawing, particularly for spot prices.

The Aussie is perhaps due for a correction. Yesterday, it held firm despite broad strength in the U.S. dollar, after Australia and China reported upbeat economic growth numbers.

Source: Barron's Asia

http://blogs.barrons.com/asiastocks/201 ... ng-aussie/
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Re: AUD 02 (Feb 12 - Dec 17)

Postby winston » Tue Mar 07, 2017 1:54 pm

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Is Reserve Bank Of Australia Too Optimistic On Growth?

By Shuli Ren

As expected, the Reserve Bank of Australia kept its benchmark interest rate unchanged at 1.50%.

But the Australian dollar rose nonetheless after the rate decision, up 0.6% for the day against the U.S. dollar, because Governor Philip Lowe took an optimistic tone on Australia’s economic growth.

In other words, the RBA will not need to cut rates any time soon and the Australian dollar will be firm?

“It’s likely that the RBA will leave interest rates unchanged at least for the next six months,” wrote National Australia Bank‘s Economist Ivan Colhoun. However, Colhoun thinks RBA’s economic assessment is too sunny.


Capital Economics’ Paul Dales agrees:
Our view remains that GDP growth will be closer to 2.0% this year than 3.0%, that growth will fall short of 3.0% next year too and that underlying inflation will stay further below 2.0% for longer.


Source: Barron's Asia

http://blogs.barrons.com/asiastocks/201 ... on-growth/
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Re: AUD 02 (Feb 12 - Dec 17)

Postby winston » Mon Apr 10, 2017 9:36 am

Aussie Dollar: Utter Capitulation to Come?

By Robert Guy

The Australian dollar has climbed back above 75 Australian cents against the U.S. dollar in early trade, but currency strategists are concerned the Aussie may come under further pressure.

The Aussie has fallen from a high of 77.3 Australian cents in late March.

Greg McKenna, chief market strategist at AxiTrader, says that the Aussie is being hurt by the risk that the Reserve Bank of Australia is the only major bank that may cut rates later this year.

This would widen the spread between Australian and U.S. interest rates and weigh on the appeal of the Aussie.

“And this thinking leaves the Aussie dollar tenuously poised and at risk of an utter capitulation,” McKenna said.

He also points to the potential for a wave of selling from a long speculative market. Here’s his outlook:

“I was a bull earlier this year. I saw a reflation trade and the long term weekly technical outlook providing an impetus for a move through the recent highs above 77 cents, a challenge of the 2016 high of 0.7840 and then a high chance of a run at 80 cents,”

“But as a trader what might be my rhetorical view is open to changes in the fundamentals, and especially the way the Aussie trades – the price action. And that has given a clear signal prices above 77 cents remain a graveyard for the bulls,” he added.

The Australian dollar is up 4% against the U.S. dollar so far this year.

Source: Barron's Asia

http://blogs.barrons.com/asiastocks/201 ... n-to-come/
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Re: AUD 02 (Feb 12 - Dec 17)

Postby winston » Tue May 16, 2017 2:48 pm

The Australian Dollar's Outlook Darkens

by Michael G Wilson

Hedge funds are giving up on the Australian dollar.

Leveraged funds cut net long positions to 12,879 contracts in the week through May 9, the sixth straight reduction and down from as high as 53,601 at the start of March, according to data from the Commodity Futures Trading Commission.

Optimism has evaporated as the prices for iron ore, Australia’s biggest export earner, plunged.

The narrowing bond yield differential between Australia and the U.S., given expectations for a rate increase by the Federal Reserve in June, adds to the concerns that have made the Aussie the worst-performing Group-of-10 currency in the quarter.

While the potential for Australia to report a current-account surplus in the first quarter may provide some relief for the currency, the impact may be temporary if commodity prices stay lower for longer, Forrester said.

The march of the Fed toward higher U.S. interest rates has also been a factor sapping optimism toward the Aussie.

The extra yield on Australia’s 10-year bonds over similar-maturity U.S. securities shrunk to as little as 19 basis points in April, the narrowest since 2001.

“The market has the second of three Fed interest rate hikes penciled in for June and for the frequency of Fed rate hikes in 2018 to decrease,” Forrester said. “If that were to increase, it would be another reason to sell AUD/USD.”

Source: Bloomberg

https://finance.yahoo.com/news/australi ... 00954.html
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Re: AUD 02 (Feb 12 - Dec 17)

Postby winston » Mon Jul 24, 2017 7:27 am

Chart of the day: Australian dollar gathering momentum

by Nicole Elliott

On Friday morning, Reserve Bank of Australia’s deputy governor Guy Debelle said: “Just as the policy rate in Australia did not need to decline to the very low levels seen in other parts of the world, the fact that other central banks increase their policy rates does not automatically mean that the policy rate here needs to increase.”

The Australian dollar, which had already broken above triangle consolidation in the previous week, pared some of its gains, balking at the psychological level of 80 US cents.

The break is significant, as is last week’s close above first retracement resistance at 78.5 US cents.

Futures volume has been dropping this year, suggesting many will have to catch up. The first target is 81.65 US cents.

Source: SCMP

http://www.scmp.com/business/markets/ar ... g-momentum
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Re: AUD 02 (Feb 12 - Dec 17)

Postby winston » Tue Sep 05, 2017 9:02 pm

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What's next for the Australian dollar?

by Daryl Guppy

The current consolidation behavior suggests that $0.835 remains a valid target.


Source: CNBC

https://www.cnbc.com/2017/09/05/whats-n ... yptr=yahoo
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Re: AUD 02 (Feb 12 - Dec 17)

Postby winston » Tue Dec 19, 2017 7:24 am

Funds Clash Over Whether Aussie Will Drop Below 70 Cents in 2018

By Netty Idayu Ismail and Shikhar Balwani

Whole yield curve up to 10 years may drop below U.S., QIC says
Disappearing premium no ‘FX disaster’: Macquarie Bank’s Berry

The Aussie will slide under that level by mid-2018 as the yield on the nation’s bonds falls below that on U.S. Treasuries.


The Aussie is likely to stay above 70 cents due to China’s robust economy and a tailwind from commodity prices.


The RBA will only tighten in the second half of next year, while the Fed will probably raise rates three times in 2018.


Iron ore delivered to Qingdao in China, a global benchmark, has jumped more than 20 percent since Oct. 31.


“I continue to look to buy the currency in the 70-to-73 cent range and sell in the 82-to-85 range.”


Source: Bloomberg

https://www.bloomberg.com/news/articles ... yptr=yahoo
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Re: AUD 02 (Feb 12 - Dec 17)

Postby winston » Mon Apr 30, 2018 9:54 pm

Goldman Sees the Australian Dollar Falling to 72 Cents

10-year Treasury yield to hit 3.5% by year end, Moffitt says
Australian dollar is second-worst performing G-10 currency

Australia’s central bank has kept interest rates at a record low of 1.5 percent since August 2016 to spur growth.

Employment rose less than forecast by economists in March, and the RBA has said it expects inflation to reach its 2-to-3 percent target only gradually.


Source: Bloomberg

https://www.bloomberg.com/news/articles ... yptr=yahoo
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