Australian Dollar watch

Dilaz89 said:

^ It's actually terrible for tourism.

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lol

deranged said:

I watch the Australian dollar every night...

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Me too, and I record the American dollar to watch afterwards.

Australian dollar expected to reach $US1 within days, analysts say

http://www.theaustralian.com.au/bus...ith-us-greenback/story-e6frg94o-1225935539162

THE Australian dollar has soared to its highest level against the US currency since it was floated 27 years ago.
The dollar surged to US98.74 cents tonight after strong jobs figures pointed to a robust economy and raised the chances of an interest-rate rise as early as next month.

The dollar has never reached parity against the greenback since it was floated by the Hawke-Keating government in December 1983. It last peaked at US98.49c in early 2008.

Some currency experts believe it could pass $US1 within days.

While the dollar rallied, Australian bonds sank on a surprisingly robust jobs report that defied market expectations.

Late this afternoon, market pricing for a November rate hike from the Reserve Bank of Australia surged to 60 per cent from 30 per cent after the data, with the market even likely to increase those odds in the next 24 hours, said Su-Lin Ong, senior interest rate strategist with RBC Capital Markets.

"It is quite possible that it could move further as into tomorrow, the risk is to the upside," said Ms Ong, citing a speech tomorrow by historically hawkish RBA Deputy Governor Ric Battellino.

Still, longer term, Ms Ong said late-October Australian inflation data and the US jobs report late tomorrow, could limit any more broad gains in rate-hike odds or big slides in bond prices.

In the interest-rate futures market, the three-year bond lost 14 ticks to 95.02, while 10-year bond futures lost four ticks to 94.925.

The Aussie dollar rose after official data showed the unemployment rate stayed steady at 5.1 per cent during September.

The jobs report found that the economy added 49,500 jobs during the month, exceeding economists’ expectations and showing the Australian labour market was remaining robustly tight.

Most of the new jobs were likely to have been created in the domestic mining industry.

The stronger jobs numbers increased the prospect the Reserve Bank will raise interest rates when it meets on Melbourne Cup Day next month.

The chance of a 25 basis-point increase before the jobs result was 40 per cent, but it jumped to 68 per cent after the data was released.

The $A had been trading at US97.63c ahead of the unemployment figure, and immediately shot higher to US98.44c after the data was released.

Federal Treasurer Wayne Swan said that, while the higher Australian dollar was reflective of a strong economy, it could have negative ramifications.

“There's no doubt that a higher dollar does have an impact on the incomes of many exporters. There's no doubt about that,” he said.

“And it has other consequences throughout our economy, but our dollar is floating and it is very much involved, or is involved in a market mechanism.”

Rochford Capital director Thomas Averill said the fundamentals driving the $A were expected to remain in place to continue supporting the $A.

“Long-term, we are bearing on the value of the US dollar because of the state of public finances and the fact they are printing their way out trouble,” he said.

“We think that points to it being a matter of time until the $A reaches parity. The $A might find it tough in the next few weeks, but we would expect it to hit parity early in 2011, when it could trade as high as $US1.05 or $US1.10.”