Aussie Dollar

[salz]

The Australian Dollar had chalked impressive gains...
Any outlook on the AUD?

 

[bvbfan]

Its got some tough resistance at 80c but needs to break 78.39 first
It seem interest rates in Australia will stay flat for a few months, but if inflation starts to rise then we could see rates being raised which would increase the attractiveness of the higher yield offered here

Personally I think it will break 80c due to USD weakness over the coming months, but will probably fail the coming test of 80c

 

[salz]

The Australian interest rate is already at a high level.
Rasing interest rate further will have a considerable effect on the financial market...

 

[Smurf1976]

My view is that the US Dollar is in the early stages of a substantial rally, the scale of which will surprise most.

I also perceive the real (as opposed to the financial markets) economy to be slowing. China in particular seems to have serious problems with bad loans whilst consumers everywhere seem a little reluctant to spend in the face of a faltering real estate boom (which has turned to outright declines in some countries), high debt levels, recent stock market falls and so on.

So I think commodities prices are not headed in Australia's favour over the short term. Add in that the US will probably raise interest rates more than our economy could stand the RBA doing (look what the last rise did to consumer sentiment and real estate). And if that's not enough there's our massive Current Account deficit around 7% of GDP (much worse than the US as a % of GDP). And then there's that drought the Bureau of Meteorology are worried about (they think an "ElNino" could be forming which usually leads to drought - this is an uncontrollable natural phenomenon unfortunately).

Looking at the charts, I suggest that the Aussie Dollar may be forming a double top which is near completion. Time will tell what the truth is...

In short, I think the Dollar is going DOWN.

 

[salz]

So U predict the AUD going down?

 

[Smurf1976]

Yes, AUD going down in my humble opinion. Should have added "Australian" before the word "Dollar" in that last sentence.

 

[Stan 101]

I'll be overseas for the next couple of years and was wondering about the dollar too. I think personally it has about peaked... It might top 80c but I think the greenback will start to rally.

Thing is, how can I move my cash into US currency?

 

[Smurf1976]

Thing is, how can I move my cash into US currency?

Assuming you want to deposit lots of $ somewhere rather than convert physical notes and coins and carry them around, there is a bank which accepts foreign currency denominated deposits.

You deposit your AUD and convert to whatever currency you choose. So if you deposit AUD100,000 and want to convert to USD then your account will have about USD79,000 in it. Assuming the AUD falls, that will be worth more than AUD100,000 when it is time to withdraw. Of course, if we are wrong and the AUD rises then you could lose.

Not sure what they are called but hopefully someone on this forum will know? (Arab Bank?)

 

[clowboy]

it really depends what you want to do with the money....if you mean to spend when you travell then travelors checks would be the best go, bear in mind that visa etc accept withdrawals worldwide (atm's) for like a 1% conversion fee (that is to say you can withdraw balinese rupiah out of an australian account for a 1-2% fee.

If you want an account to hold differing currencies for the purpose of playing the rate then HSBC bank springs to mind www.hsbc.com.au (there are others.

 

[bvbfan]

Converting notes would not be worth it due to the spreads charged by money changers, actually noticed the banks are better although you pay a fee to convert with them

I've heard of people who have CFD accounts transferring the money in AUD to their USD account and when rates have moved they have brought it back

You'd need to check with these CFD providers if they offer such accounts as well

 

[Stan 101]

Hi Guys. Thanks for the replies and sorry for the hijacked thread..

Yes I am looking to park cash as USD in a bank account. I'll try HSBC.

If anyone else knows of any other banks doing this, please feel free to let me know...

 

[salz]

I think most banks offers foreign currency deposit account, citibank, hsbc...
The US economic data doesn't looks bright... Consumers losing confidence, higher unemployment, higher inflation rate due to high oil price, widening deficit...
How are the US dollar going to rally then?
I don't think the US deficit will go down by end of this quarter. The Fed might actually wanna the usd to remain low to boost export and curb massive Chinese goods influx...

 

[doctorj]

I know the CBA offers foreign currency accounts, but you may experience some resistance from staff if you want one unless you're planning to deposit 100k+. I'm also unaware of what interest rates they offer on these accounts.

HSBC or Citi might be the go.

 

[Smurf1976]

The Fed might actually wanna the usd to remain low to boost export and curb massive Chinese goods influx...

The Chinese currency is pegged to the US Dollar and as such any change of value in the USD has no direct effect on Chinese goods exports. The effects that do exist are indirect, such as the forced change in the vaule of China's currency affecting their import prices and cost of production. Of course, US producers face exactly the same effects which cancels out any benefits thus maintaining China's advantage.

 

[bvbfan]

As far as I'm aware CBA foreign currency accounts were for Import/Export businesses and not open to personal customers
The fees are pretty high to from what I've been told ($50 a month?)

The interest rates are based on the market rates for the currency you hold the funds

Do a search on the CBA site and you should find more info, PDS's etc

 

[salz]

The Chinese currency is pegged to the US Dollar and as such any change of value in the USD has no direct effect on Chinese goods exports. The effects that do exist are indirect, such as the forced change in the vaule of China's currency affecting their import prices and cost of production. Of course, US producers face exactly the same effects which cancels out any benefits thus maintaining China's advantage.

Oh, that's one point that I missed out... The currency peg...

 

[mime]

I think the AUS dollar won't break $.80. The US Dollar will rise and their economy will recover heavly because of the Republicans tax cuts.

My 2 cents.

 

[salz]

They can cut tax, but the with the high deficit and high oil price lingering...
It would be a major challenge...

 

[salz]

Assuming you want to deposit lots of $ somewhere rather than convert physical notes and coins and carry them around, there is a bank which accepts foreign currency denominated deposits.

You deposit your AUD and convert to whatever currency you choose. So if you deposit AUD100,000 and want to convert to USD then your account will have about USD79,000 in it. Assuming the AUD falls, that will be worth more than AUD100,000 when it is time to withdraw. Of course, if we are wrong and the AUD rises then you could lose.

Not sure what they are called but hopefully someone on this forum will know? (Arab Bank?)

I got another idea. If you think the US Dollar will appreciate, it might be better to hold Malaysian Ringgit. As it is pegged to the US Dollar, its value will move in line with the USD. Malaysia pegged its currency (ringgit) during the '97 Asian Economic crisis to shield it away from forex speculators. After years of economic recovery and progression, it is reviewing its peg. There's news that they will adjust the peg to appreciate the ringgit. Therefore, if Malaysia does adjust the peg to appreciate its ringgit and USD rises. There will be double gains...