Aussie Dollar Dives

[Saan]

I'm beginning to understand how the Greeks must feel.

This morning the Aussie dollar buys 25 baht. And the Cassandras of the financial world are predicting even more falls.

In effect it seems that when the US dollar is doing well we are doing badly.

Much as I care about our American cousins I am looking forward to the robber barons of Wall Street correcting this imbalance by plundering their own, once again. Then we can return to an equitable parity. Thirty baht will do nicely, anything over a bonus.

Already I know of my fellow countrymen who have fallen below the dreaded 65,000 baht cut off for the retirement visa.. If the fall continues there will be more, particularly with interest rates so low.

It always seems strange to me how resilient the baht is. Martial law, coups, declining exports, drought - nothing shakes it. A miracle currency.

"Australia's dollar dropped to a six-year low on signs of sluggish consumer spending and after iron ore prices slid the most in two months.

The Aussie fell for a third day against the US dollar, the longest streak in a month, as data showed retail sales rose 0.3 per cent in May from the previous month, compared with the median economist estimate for 0.5 per cent growth. It's down versus 12 of its 16 major peers this week.

"The economy is still struggling to make that transition from mining-led growth to other forms of growth," said Joseph Capurso, a strategist at Commonwealth Bank of Australia in Sydney. "That is just going to keep bearing down on the Aussie."

The Australian dollar slumped 1.6 per cent to 75.15 US cents as of 4:14 p.m. London time, after falling as low as 75.09 cents, a level unseen since May 2009. It slumped 1.8 per cent to 92.21 yen, after being at 92.09, the weakest level since April 21.

The decline in the Aussie will be welcome news for Reserve Bank of Australia Governor Glenn Stevens who has called for a weaker currency to stimulate economic growth. The 1.8 per cent decline this week wiped out a 1.3 per cent gain in the three months ended June 30, the first quarterly gain in a year." - Sydney Morning Herald

Edited July 4, 2015 by Saan

[sappersrest]

Great for us poms visiting Oz tough £1 gets 2 dollars now.Should be good for Australian tourism if they are quick about it and advertise what a bargain destination it is.

[Tywais]

Not Chiang Mai specific so moving to the Banking/Business forum. Link will still be in the CM forum.

[Don Mega]

good to hear it has risen from the 24.61 low in april.

[SheungWan]

OP: 'What I want, what I really, really want'

Chorus: 'Ziggazaggah....'

[JakeSully]

Hell no. I want USD = 1000 baht.

[CMKiwi]

Kiwi is also at a 5 year low, just 22 baht to the NZ dollar. Luckily Im not on a pension yet so I dont feel the effects of this exchange slide. But I do know a few Aussies that are feeling the pinch, although it doesnt stop them having a few cold ones regularly. Its still a lot more affordable to live here than back home.

[bangmai]

i don't think it will boost auto exports much, since all the automobile factories have closed. They made their bed with the Chinese; now they can sleep in it.

[Saan]

Here is a headline that really sends shivers up my spine.

Australian dollar to hit US62¢ in 2016: Morgan Stanley

[TheAppletons]

AUD was relatively overvalued for quite some time. It's back now to where it was 10 years ago vis-a-vis the USD. It had a fine run during the years when the commodities markets were overheated (2011-2013) but has lost those gains now that the Chinese economy is slowing a bit. It all goes in cycles....unless you live in Greece.

[nev]

Here is a headline that really sends shivers up my spine.

Australian dollar to hit US62¢ in 2016: Morgan Stanley

Would buying US dollars now counteract in case the Aussie goes that low, just a thought

[Sparkles]

good to hear it has risen from the 24.61 low in april.

Aussies, myself included, can only thank the mess Thailand's economy is in resulting in the Thai baht being poor otherwise we would really be in the poo.

[el jefe]

Here is a headline that really sends shivers up my spine.

Australian dollar to hit US62¢ in 2016: Morgan Stanley

Would buying US dollars now counteract in case the Aussie goes that low, just a thought

Yes, that would lock in the conversion at USD rates. But then an Aussie would have to hope that the Aussie dollar continues to slide. If it goes up, you lose.

[Time Traveller]

The A$ seems overvalued. I remember going to buy a can of coke a few years back . The cost ....$3 !!!.....about 3 times what you would pay in the US and about 5 times what you would in thailand.

Eventually the A$ will probably head back to around $0.50. It may take a few years.

Edited July 4, 2015 by Time Traveller

[Don Mega]

The A$ seems overvalued. I remember going to buy a can of coke a few years back . The cost ....$3 !!!.....about 3 times what you would pay in the US and about 5 times what you would in thailand.

Eventually the A$ will probably head back to around $0.50. It may take a few years.

There is a reason why it is classed as the most expensive country in the world to live.

[simple1]

i don't think it will boost auto exports much, since all the automobile factories have closed. They made their bed with the Chinese; now they can sleep in it.

On the automotive front Australia is exporting car engines e.g. to Toyota in Thailand. In 2014 top 10 export industries were:

1. Ores, slag, ash: US$82,785,152,000 (32.8% of total exports)
2. Oil: $65,198,853,000 (25.8%)
3. Gems, precious metals, coins: $14,042,657,000 (5.6%)
4. Meat: $10,476,584,000 (4.1%)
5. Cereals: $7,472,099,000 (3.0%)
6. Inorganic chemicals: $5,823,945,000 (2.3%)
7. Machines, engines, pumps: $5,823,392,000 (2.3%)
8. Aluminum: $4,162,912,000 (1.6%)
9. Copper: $3,858,598,000 (1.5%)
10. Medical, technical equipment: $2,868,950,000 (1.1%)

Exports of services were worth about $60 billion in 2014, of which the largest sector would be education.

http://www.smh.com.au/business/comment-and-analysis/iron-ore-no-longer-our-biggest-export-20150313-142za6.html

With all the chest beating rhetoric by Abbott, Liberals have been just as lax as Labor over the years by not investing in the 'clever country'.

Edited July 4, 2015 by simple1

[simple1]

Here is a headline that really sends shivers up my spine.

Australian dollar to hit US62¢ in 2016: Morgan Stanley

Sure, but in the same report in SMH it claims:

"The median forecast by analysts for the Australian dollar at the end of this year is US74¢, edging up to US76¢ by the end of 2016, according to Bloomberg:

However, I do recall at one time AUD was only buying about 19 baht.

[samran]

Am I the only one singing 'down down' with a smile on my face?

[Ace of Pop]

Jeez if I was a Digger if never leave,so much to see there.

[samran]

i don't think it will boost auto exports much, since all the automobile factories have closed. They made their bed with the Chinese; now they can sleep in it.

The auto industry were being subsidised up the clacker and still couldn't make a buck. Good riddenence as far as I'm concerned.

[Srikcir]

Your robber barons of Wall Street will not plunder the stock market as you suggest until AFTER Hillary Clinton is elected POSTUS. So look for another year of international currencies being depressed further by the US dollar.

Short-term investments in blue chip US securities might be a good hedge to some country's exchange rates.

[elgordo38]

Your robber barons of Wall Street will not plunder the stock market as you suggest until AFTER Hillary Clinton is elected POSTUS. So look for another year of international currencies being depressed further by the US dollar.

Short-term investments in blue chip US securities might be a good hedge to some country's exchange rates.

Money from around the world is pouring into the US dollar and stock market. When the Fed starts to raise rates this will only get worse but I get the feeling after they read the financial entrails of the US economy they will pass on the idea. It is classed as the best of the worst a safe haven. So many currencies are in a race to the bottom to boost exports and you might see that happening here in the next year or so. The strong dollar is also support by the fact the the US buck is involved in the buying of most commodities and that is what is propping up their horrendous deficit. Thanks to that they can finance the fact that they are living beyond their means and a Greece debacle is a ways off. This could come to an end in the near future as a lot of countries are doing currency swaps i.e. Russia and China. The increasing strength of the Chinese currency could have a moderating effect on the dollar. If the US stock market tanks that should take some of the shine off. In reality there is nothing in the American economy to prop up the market and the dollar. Companies are distorting their earnings with stock buybacks instead of expanding. Discouraged people have quite looking for work the percentage of employed people is down debt is up unemployment claims are creeping up. Wages are moving up ever so slowly the minimum wage is stagnant( a lot of citizens are in this category) millenniums are finding it harder to find jobs and survive a lot are living in their parents basement and well the list is to long to mention. A lot of money people are selling out in the West and moving their bucks to Asia and that to is propping up the baht. There is a lot of hype here give it another year and lets see where the baht is. There could be a lot of surprises lurking in the wings here some of which are verboten to talk about.

[bangmai]

a lot of people are in the minimum wage category? More quotes from Michael Moore? Less than 3%, and of those many are under 21, in their first job. http://www.politifact.com/truth-o-meter/statements/2013/dec/08/rob-portman/rob-portman-says-about-2-percent-americans-get-pai/ However, lack of wage growth has been slowing economic growth, but in 2006 only 12% of Federal workers earned more than 100K per year; now it is 22%. Also, new household formation is a big issue. IOW, the kids won't move out of their parent's basements. Stock buybacks do increase EPS, which does strengthen, it is a sign of a slow growth environment. EPS is EPS, and there is no conspiracy there, either. It's all very public information.

[el jefe]

Your robber barons of Wall Street will not plunder the stock market as you suggest until AFTER Hillary Clinton is elected POSTUS. So look for another year of international currencies being depressed further by the US dollar.

Short-term investments in blue chip US securities might be a good hedge to some country's exchange rates.

Money from around the world is pouring into the US dollar and stock market. When the Fed starts to raise rates this will only get worse but I get the feeling after they read the financial entrails of the US economy they will pass on the idea. It is classed as the best of the worst a safe haven. So many currencies are in a race to the bottom to boost exports and you might see that happening here in the next year or so. The strong dollar is also support by the fact the the US buck is involved in the buying of most commodities and that is what is propping up their horrendous deficit. Thanks to that they can finance the fact that they are living beyond their means and a Greece debacle is a ways off. This could come to an end in the near future as a lot of countries are doing currency swaps i.e. Russia and China. The increasing strength of the Chinese currency could have a moderating effect on the dollar. If the US stock market tanks that should take some of the shine off. In reality there is nothing in the American economy to prop up the market and the dollar. Companies are distorting their earnings with stock buybacks instead of expanding. Discouraged people have quite looking for work the percentage of employed people is down debt is up unemployment claims are creeping up. Wages are moving up ever so slowly the minimum wage is stagnant( a lot of citizens are in this category) millenniums are finding it harder to find jobs and survive a lot are living in their parents basement and well the list is to long to mention. A lot of money people are selling out in the West and moving their bucks to Asia and that to is propping up the baht. There is a lot of hype here give it another year and lets see where the baht is. There could be a lot of surprises lurking in the wings here some of which are verboten to talk about.

I couldn't tell if you are just a US-hater, or are very, very confused.

But once I got to the part where you said "A lot of money people are selling out in the West and moving their bucks to Asia and that to is propping up the baht", I figured it out.

[samran]

Your robber barons of Wall Street will not plunder the stock market as you suggest until AFTER Hillary Clinton is elected POSTUS. So look for another year of international currencies being depressed further by the US dollar.

Short-term investments in blue chip US securities might be a good hedge to some country's exchange rates.

Money from around the world is pouring into the US dollar and stock market. When the Fed starts to raise rates this will only get worse but I get the feeling after they read the financial entrails of the US economy they will pass on the idea. It is classed as the best of the worst a safe haven. So many currencies are in a race to the bottom to boost exports and you might see that happening here in the next year or so. The strong dollar is also support by the fact the the US buck is involved in the buying of most commodities and that is what is propping up their horrendous deficit. Thanks to that they can finance the fact that they are living beyond their means and a Greece debacle is a ways off. This could come to an end in the near future as a lot of countries are doing currency swaps i.e. Russia and China. The increasing strength of the Chinese currency could have a moderating effect on the dollar. If the US stock market tanks that should take some of the shine off. In reality there is nothing in the American economy to prop up the market and the dollar. Companies are distorting their earnings with stock buybacks instead of expanding. Discouraged people have quite looking for work the percentage of employed people is down debt is up unemployment claims are creeping up. Wages are moving up ever so slowly the minimum wage is stagnant( a lot of citizens are in this category) millenniums are finding it harder to find jobs and survive a lot are living in their parents basement and well the list is to long to mention. A lot of money people are selling out in the West and moving their bucks to Asia and that to is propping up the baht. There is a lot of hype here give it another year and lets see where the baht is. There could be a lot of surprises lurking in the wings here some of which are verboten to talk about.

I couldn't tell if you are just a US-hater, or are very, very confused.

But once I got to the part where you said "A lot of money people are selling out in the West and moving their bucks to Asia and that to is propping up the baht", I figured it out.

I wish people would just learn the meaning of 'commodity currency' and this thread would be over in a flash.

[Naam]

Your robber barons of Wall Street will not plunder the stock market as you suggest until AFTER Hillary Clinton is elected POSTUS. So look for another year of international currencies being depressed further by the US dollar.

Short-term investments in blue chip US securities might be a good hedge to some country's exchange rates.

Money from around the world is pouring into the US dollar and stock market. When the Fed starts to raise rates this will only get worse but I get the feeling after they read the financial entrails of the US economy they will pass on the idea. It is classed as the best of the worst a safe haven. So many currencies are in a race to the bottom to boost exports and you might see that happening here in the next year or so. The strong dollar is also support by the fact the the US buck is involved in the buying of most commodities and that is what is propping up their horrendous deficit. Thanks to that they can finance the fact that they are living beyond their means and a Greece debacle is a ways off. This could come to an end in the near future as a lot of countries are doing currency swaps i.e. Russia and China. The increasing strength of the Chinese currency could have a moderating effect on the dollar. If the US stock market tanks that should take some of the shine off. In reality there is nothing in the American economy to prop up the market and the dollar. Companies are distorting their earnings with stock buybacks instead of expanding. Discouraged people have quite looking for work the percentage of employed people is down debt is up unemployment claims are creeping up. Wages are moving up ever so slowly the minimum wage is stagnant( a lot of citizens are in this category) millenniums are finding it harder to find jobs and survive a lot are living in their parents basement and well the list is to long to mention. A lot of money people are selling out in the West and moving their bucks to Asia and that to is propping up the baht. There is a lot of hype here give it another year and lets see where the baht is. There could be a lot of surprises lurking in the wings here some of which are verboten to talk about.

I couldn't tell if you are just a US-hater, or are very, very confused.

But once I got to the part where you said "A lot of money people are selling out in the West and moving their bucks to Asia and that to is propping up the baht", I figured it out.

I wish people would just learn the meaning of 'commodity currency' and this thread would be over in a flash.

you are asking for too much plus there's a certain dangerous aspect which might confuse our american friends where a "commode" looks like this

[samran]

^^ not too confusing Naam.

Exactly where the australian dollar is headed...

[Naam]

^^ not too confusing Naam.

Exactly where the australian dollar is headed...

there... there... you are too pessimistic Samran

[samran]

^^ not too confusing Naam.

Exactly where the australian dollar is headed...

there... there... you are too pessimistic Samran

I'm cheering it down the toilet! Next stop, 70 cents!