The Australian dollar is as strong as it’s been since the beginning of the commodities boom. It takes just one dollar and five Australian cents to buy the greenback. The latest move probably comes as traders read the inflation tea leaves and do not see the Reserve Bank cutting rates this year. If the CPI data show official prices growing above the 3-4% range, then for the rest of 2008 the Australian dollar is going to enjoy a significant yield advantage.
April 23rd, 2008 | The Daily Reckoning | 2 comments | ContinuedAll Posts Tagged With: "U.S. dollar"
AUD USD Parity Could Be Difficult to Reach
The Aussie is hostage to competing forces right now. On one hand, the endless rise of world commodities prices and the great fall of the US Dollar are good reasons to back the Australian currency. Indeed, Australian exporters can take full advantage of rising gold, metals and energy prices.
March 18th, 2008 | Dan Denning | 1 comment | Continued
Bernanke is Going to Run Out of Bullets and Have to Throw the Gun
It’s hard to say for sure, but we reckon this is evidence of speculative traders and hedge funds reducing their long positions in the commodities markets. In the retreat to a larger cash position, even profitable trades in commodities must be sold.
March 18th, 2008 | Dan Denning | 3 comments | Continued