Australian Dollar

While on your family vacation in the US, you treat the family to dinner at a fabulous restaurant. You pay the US$100, and the next day you see AU$138 has been deducted from your account. Easy.

The next day, you decide you loved the meal so much you want to go back again. As you and your family order the exact same meal, you see that you’ve paid AU$145 for the same food, from the same restaurant, with a receipt for US$100. What happened?

Over the past 20 years, one Aussie dollar has been worth as much as US$1.10, and as little as 48 US cents. Currency movements like this are complicated and have myriad factors. Whether it be trade relations with the US and China, a slow-down in overseas commodity demand, or an uptake in demand for Aussie-grown produce, many things can influence how much you’ll pay for your next meal.

Here at Money Morning, we have the expertise and know-how to make sure any investor with exposure to foreign currencies is prepared for the events that affect the Aussie dollar, and where to keep an eye out.

Why You Should Ignore the Federal Budget

If you’re caught up wondering/hoping how much you’re going to get from the budget, you’re on the path to putting security over freedom. Because when you want the government to provide for you, it’s pretty much all over.

The ‘Magic’ of the Aussie Dollar

Australia, as an investment destination, suffers from an increase in risk perceptions. Foreign capital is less willing to invest here, or buy debt issued by the banks to fund the mortgages of Aussie battlers. As a result, the Aussie dollar falls. However, the ‘magic’ of a falling dollar is that it increases the purchasing power of foreign currency.

Watch These Two Chinese Economic Indicators

Amongst all the panic and hand-wringing over what the volatility of the past week means, we haven’t heard much about China. Which is kind of crucial, especially for Australia. Put simply (and accurately) if China holds up, Australia will be fine. So, is China holding up?

The End of the Strong Aussie Dollar

The Aussie dollar is getting a boost from stronger commodity prices. Recent price rises have helped push the dollar higher. The Aussie dollar has had a strong start to the year. However, it may be more cyclical than anything to do with the underlying strength in the Aussie dollar.
Money Morning Australia