Anyone Know What's Happening To The Aussie Dollar Exchange Rate?

[standbyme]

From my limited understanding of economics I thought that the crisis in Bangkok and Chiang Mai with the red shirts would be beneficial to the exchange rate from Aus>Thai?! Howcome in the last month it's gone down nearly 4 baht to the dollar? Anyone have any clue? Excuse my ignorance, I paid little attention in Economics classes...

[neverdie]

Its got little to do with the thai baht, which really hasnt flucuated much at all through this crisis.

The Aussie has suffered significantly in the last few days/week or so as the European countries have a bit of a 'wobble' and many investors dump their shares on commodities & high yielding curriencies such as the Aussie dollar. As this happens the value of the AUD goes down.

Many argue that the Aussie dollar at 90 us cents is over valued and it generally sits closer to the 75 cent mark. It has basically dropped from near the 89-90 cent mark a week ago to 83, where it sits now.

Surely you are familiar with what the Aussie currency does during uncertain times, a great example of such was the end of 2008. Anyway, the poor old aussie battler is coping a belting once again . Its not all doom and gloom though, some people actually make a living this way and people exporting goods from Australia will be jumping with joy.

Its really only gone down 3 baht to the dollar over the last month, its presently sitting at smack on 27.

Edited May 21, 2010 by neverdie

[standbyme]

Its got little to do with the thai baht, which really hasnt flucuated much at all through this crisis.

The Aussie has suffered significantly in the last few days/week or so as the European countries have a bit of a 'wobble' and many investors dump their shares on commodities & high yielding curriencies such as the Aussie dollar. As this happens the value of the AUD goes down.

Many argue that the Aussie dollar at 90 us cents is over valued and it generally sits closer to the 75 cent mark. It has basically dropped from near the 89-90 cent mark a week ago to 83, where it sits now.

Surely you are familiar with what the Aussie currency does during uncertain times, a great example of such was the end of 2008. Anyway, the poor old aussie battler is coping a belting once again . Its not all doom and gloom though, some people actually make a living this way and people exporting goods from Australia will be jumping with joy.

Its really only gone down 3 baht to the dollar over the last month, its presently sitting at smack on 27.

Cheers mate, that makes things a lot simpler... Do you think the exchange rate will stay as is for the time being or is such a quick drop likely to go back up?

[neverdie]

I should of also said that the USD hasnt risen against the Aussie, but rather the Aussie has dropped in line with some other currencies in Europe.

I have absolutely no idea whats going to happen next, I've asked a few of those thai fortune tellers but none of them seem to know what Im talking about.

Some have predicted the fall will stop around the 80-81 cents to the USD (which would mean about 26 baht to the dollar) but Ive got no idea, none whatsoever. This morning it actually dropped to 81.8 cents/USD but then rose again to where it is now @ 83.1cents/USD.........who knows?

High yielding curriencies like the Aussie and equity markets always fluctuate significantly in uncertain times, you can only probably bet on one thing and that is there are more uncertain times to come.

Edited May 21, 2010 by neverdie

[bdenner]

The Aussie Dollar follows the Stock Market trends pretty closely. Stock markets in most Western societies have dropped nearly 10% over the last week and thus the AUD has dropped 10% against the USD. The Thai Baht is loosely tied to the USD so there you have your 3 Baht drop. Down to 27 from just on 30. Luckily I grabbed large wad at near to 30 Baht a few weeks ago.

Edit: Typo's

Edited May 21, 2010 by bdenner

[neverdie]

Many people get really worked up about this. I'm generally a happy little soul if Im getting above 24-25 baht per dollar & really if we want to be realistic @ the 30 baht to the dollar we are being given a gift from the curriency gods.

Its when it drops down to 20 odd, I generally put on the face.

[cpofc]

Apart from the problems in Europe and the Euro, Rudd, Swan and Henry shot the Goose Laying the Golden Eggs by targetting the mining industry to cover their reckless spending, fiscal irresponsibility and incompetence.

The Golden Goose is now in hospital, in ICU, and is not allowed visitors.

The Oz Stock Exchange recovered a little after an early morning scare and tumble today, The AUD steadied too. Thank christ!

[neverdie]

Apart from the problems in Europe and the Euro, Rudd, Swan and Henry shot the Goose Laying the Golden Eggs by targetting the mining industry to cover their reckless spending, fiscal irresponsibility and incompetence.

The Golden Goose is now in hospital, in ICU, and is not allowed visitors.

The Oz Stock Exchange recovered a little after an early morning scare and tumble today, The AUD steadied too. Thank christ!

Great post, thanks for the chuckle.

Old mate Kevin 007, krudd the dudd was sprouting off on the news today about mining taxes having nothing to do with the $ aussie buck falling.

I wonder how long it will take for him to do a back flip on that one?

http://www.news.com.au/business/breaking-n...from=widget_rss

[bobbin]

I'll take a crack at this...

Your Aussie Dollar and my Canadian Dollar are now known as "commodity currencies" and as such are suffering from the general pullback due to the Euro problems and Greek etc debt.

Oil (Canada) and minerals (Australia) are off significantly but likely short-term. Unless the Asian economies crater, we'll be back in the high-life soon.

[Garry9999]

Michael Pascoe is calling it a correction, hope he's right.

http://www.smh.com.au/business/ever-seen-a...tml?autostart=1

[garyh]

Experts where saying the AUD would reach parity (100 to 100) with the USD buy mid year. Doesn't look like that will be the case though. Just be happy your not a Pom they have have faired a lot worse.

[tfc]

A friend and myself were commiserating about this earlier today before we realized that we were sitting on the beach relaxing and enjoying a beer and about to get a massage. We realized that life is still good here...well as long as there is no civil war.

[Naam]

I should of also said that the USD hasnt risen against the Aussie, but rather the Aussie has dropped in line with some other currencies in Europe.

Honourable Sir ND, Esq., please have mercy. i humbly beg of you!

[jackr]

26 is still ain't bad; wasn't it in the low 20s this time last year/18 months ago? The quid is still dropping, too... 46ish at the mo. H3ll of a comedown from 75 few years back and even more of a poke in the eye beings beer, rice, eggs, and fuel have almost doubled of late.

[ozzieovaseas]

Yes, i can remember many a day of OZ$=22baht..thats when we can scream like the lek kahtoey

[neverdie]

I should of also said that the USD hasnt risen against the Aussie, but rather the Aussie has dropped in line with some other currencies in Europe.

Honourable Sir ND, Esq., please have mercy. i humbly beg of you!

Dear Naam, Do you actually think I have something to do with this .

Anyway, I'm not real good with these things nor predicting their future (ohhh I wish I could - then I would own Naams asss ) but something tells me things are going to bounce around for some time yet, there are numerous countries facing currency crisis & Im guessing things are going to get really wild when the USD goes end over end & loses its reserve currency position & becomes the American paeso. Am i right Naam?

[neverdie]

Yes, i can remember many a day of OZ$=22baht..thats when we can scream like the lek kahtoey

Yes, I remember those days, it was great, I use to say to my father......"Ohh the exchange rate is aweful, couldnt possibly bring money over at this rate, can ya spot me a few baht" They were cheap days back then.

[cpofc]

Since it's inception on 14th Feb, 1966, The Australian Dollar reached its pinnacle in September 1974. (I was in Yokosuka, Japan at the time). It was the first of many devaluations, until Paul Keating changed it from a Note to a Coin and Floated it in the early 80's. Truth is that it didn't float, it sank quicker than the Titanic.

The last few years has been a bonus for Aussies who have enjoyed the best exchange rates against the Baht in recent history.

During the 70's it was always around the 22-23 Mark and if I were to take a mean over the past 40 year it would be no higher than 25. Bouyed up by the past few years only.

During Paul Keating's Banana Republic Days, the Recession we had to have, Thailand was booming and the rate dropped to as low as 15!

I am not complaining, but when it got to 32 it sure was a bonus. I hope it does so again.

[cpofc]

Oh, I did forget to mention that we had a brief Honeymoon period with the crash of the Asian Tigers in 97. But that was relatively shortlived and it slipped back to 23 a short while later.

[neverdie]

During Paul Keating's Banana Republic Days, the Recession we had to have, Thailand was booming and the rate dropped to as low as 15!

I don't remember 15, but do remember around the 19 mark. I wouldnt like to see 15's again, I could quite possibly push off at that sort of rate

[cpofc]

When I first started visiting Japan (1970) we were getting slightly over 400 Yen to the dollar! You will never see that again!

Singapore Dollar got as high as $3.72 by 1974. and the Philippine Peso hovered around 7.5 - 10!

[neverdie]

I wonder where the Aussie will sit in say 2 years time & at the end of this shamozzel thats going on?

[cpofc]

Unfortunately even Nostradamus himself would struggle to predict that. These are dangerous and uncertain times we live in.

hehehehe when the recent GEC hit us and we went into to freefall, hitting 20 Baht (and .55 US) and still going South I jokingly said that i always wanted to find out what it is really like to live as a 'Blue Collar' Thai, I had visions that I was about to find out! I am not a big lover of Sardines in Tomato Sauce.

I was surprised, and delighted, that it clawed its way back to 92 Cents US. I thought it would have levelled out at around .75

[lingnoi1977]

Sometimes it is better not to know what is coming but here is what I know as chief economist - of my family

There will be further downward pressure on the AUD in the next few months as it is a commodity currency. There are mixed signals about the prices of commodities at the moment and nervousness about China (and Indias) future appetite for our commodities. Are they going to experience growth at the same rate or a slowdown? This, together with the RBA signalling that interest (cash rate) rates will probably remain at the current level spooked o/s investors. Investors do not see AUD as a good long term investment at the moment, so they have sold AUD in favour of the Greenback. This has hurt the AUD.

But here is the strange thing. Everytime there is a crisis, worldwide or local, the Thai baht never seems to lose ground. Some think it is because Thailand does not rely on debt as much as other nations partly due to its high % of exports. Others think that the Thai Baht is propped up artificially by the government. I know which one I believe...

I note in the Bangkok Post last week that in light of the recent protests and subsequent destruction of the economy, the govt. are talking about massaging the Baht to encourage tourism and trade back into Thailand. They sited August as the date. I am not sure how they will do this but a couple of baht would certainly ease the pressure.

I have been sending money here for the past year at an average of 30 Baht to the AUD in preparation for the inevitable drop. It just so happens that a large wad of additional cash is now needed for completion of my house. What timing! Just another couple of months and all would have been ok. But I look at the average over time. I expect if the dollar drops to about 24 baht, my average will be 27 which is not too bad.

One good thing - Aussie interest rate is amongst the highest in the world so keep your cash in a term deposit. This should outstrip any shift in the currency.

Good luck all.

[garyh]

If you laid all the economists in the world end to end, they still wouldn't reach a conclusion.

[harrry]

I think the dollar should settle. I do not need to bring any more into Thailand for a while. Watch for another drop when I do. The dollar is allways low when I need it and high when I do not.

[lingnoi1977]

I think the dollar should settle. I do not need to bring any more into Thailand for a while. Watch for another drop when I do. The dollar is allways low when I need it and high when I do not.

ok harrry. hold off for a couple of months in that case and I'll split the difference with you...

[SeanMoran]

If they stop digging up all the land to export to China, then there's not much left of any value. That is why the new 40% tax has seen the AUD plummet. Apart from the land it lies on, it's worthless.

[Livinginexile]

During Paul Keating's Banana Republic Days, the Recession we had to have, Thailand was booming and the rate dropped to as low as 15!

I don't remember 15, but do remember around the 19 mark. I wouldnt like to see 15's again, I could quite possibly push off at that sort of rate

I remember 14-15.

I'm trying to remember what year it was...I think around 1994-6?

[Gambles]

During Paul Keating's Banana Republic Days, the Recession we had to have, Thailand was booming and the rate dropped to as low as 15!

I don't remember 15, but do remember around the 19 mark. I wouldnt like to see 15's again, I could quite possibly push off at that sort of rate

I remember 14-15.

I'm trying to remember what year it was...I think around 1994-6?

I'm putting a piece together on the AUD for publication w/c June7th - I'll share on here when I can but the bottom line is that the downside is much worse than any of the comments on here imply - no-one's really covered the interest rate differential issues and the impact of the carry trade and these are currently as significant a factpr as exports.

There'll be plenty of vol and plenty of rallies but ultimately don't rule out 20 or even significantly less.