Aussie $ trend

LEl Cap on 16/10/2013 - 10:59

I have an overseas loan to pay so it is great that the Australian droller is going up. I am just wondering how much of this is due to the current situation is US, and whether I should make a transfer now or wait a bit more… any advice?

Thanks.

Financial

Comments

  • ESEMCE on 16/10/2013 - 11:09
    +2

    It's entirely due to the US situation…
    And it really depends on what happens there, both in terms of the Debt Ceiling and the Federal Reserve Quantitative easing.
    If the Fed reduces Quantitative Easing, then the Aussie will go higher.

    • El Cap on 16/10/2013 - 11:24

      Thanks, sucbacoles.

      What would you advice? Should I transfer some money sometime soon, or wait a bit more to see how it is going…

      • ozhunter on 16/10/2013 - 13:32
        +1

        I'd pay half now half later on. So if it goes up or down, you'll feel half as good/bad. :D

        • quirki on 16/10/2013 - 13:37
          +1

          This is not a good idea because of transaction costs.

    • mskeggs on 16/10/2013 - 13:39
      +1

      If the Fed reduces QE there may well be a flight from risk like the AUD. The recent AUD dollar strength was on the back of the Fed pushing out Septaper.
      I think it would be foolish to bet on further AUD appreciation. It has much more downside than up, IMHO.

  • quirki on 16/10/2013 - 12:24
    +1

    http://www.bloomberg.com/news/2013-10-07/top-forecaster-hsbc…

    My opinion: Change if you feel comfortable with the current rate, don't hold out for further AUD appreciation. No one has a crystal ball that can predict the AUD rate 100%. If AUD goes up, you lose out on potential gains and feel like shlt. However if AUD moves the other way, you will be in shlt, especially if you have a debt to pay.

    That being said, the best advice is to seek professional advice.

    • ESEMCE on 16/10/2013 - 12:55
      +1

      Agreed.. it's unlikely to move considerably either way.. you'd be saving yourself a few % at best I would have thought.

      Plus if they default, who knows what will happen?

  • El Cap on 16/10/2013 - 15:24

    Thanks all for kindly sharing. I did transfer some money.

    I also thought the best bet is to transfer some money, but it is good to hear from others too. Particularly, since what I thought didn't had much reasoning behind it.

  • cpho on 16/10/2013 - 20:42
    +1

    This is a really precarious situation. The Republicans dont seem like they'll shift, and Obama's made his stance clear. If the US defaults on it's debts, the AUD will go up up and away. That would be bad in many ways. Our interest rates will plunge to keep us lower than the USD to keep our exports competitive but then our savings accounts will suck.
    On the otherhand, if the US pulls it's s*** together, then we might have the opposite, with the AUD having a big drop before the RBA pushes the interest rates back up.
    Given that you've already done your thing, I guess just hold your breath and wait out the end of the week.

    • altomic on 17/10/2013 - 03:04
      +1

      but given the ongoing situation in Syria and the resultant sympathies of Arabic nations into the inaction of the West/UN will undoubtedly induce an unstable crude price with the flow on effect for transport costs regarding SEA imports of Aust primary produce, especially in Indonesia. Such cyclic events, in line with the recent US shutdown, will further debilitate any realignment of the AUS to mid 2012 levels. Fiscal projections of the WTO reflect similar concerns that continue to be echoed in repeated downturns of the Hang Seng and Nikkei. about the only thing in your favour is that gold has stabilised from its 20year upswing.

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