AUD/USD Exchange

Eagle87

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I wager through my own trading, and I continue to be long the AUD/USD, despite the recent short term downtrend. I don't set timeframes for my trading, only once the long term trend reverses will I exit and consider a reversal. My prediction of parity was not short term, as I am not a short term trader. I am happy to be proven wrong, but I doubt the AUD/USD will end up far below 0.85c in the short term, and am quite comfortable with the notion of parity in the long term.

Still long AUD/USD?

Care to define short term and long term?
:)
 

fairdinkum

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Ay Caramba!

Chart.aspx

[Orig posted 20/5/10]

Lowest it has been since I got here. Please oh please make the bad man stop.
 

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Funny thing, the shares I own lost as much money as the dollars i've got in a US bank acc. increased in value with the fall of the Aussie.
 

Dr Awkward

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Hey,

I have no idea about currency trading or anything but just want your advice:

Going to USA and Europe for 6 months next year and obviously am going to be spending a lot of money do you think it is wise to get a fair bit out now or is it possible that the AUD will just keep going up? I'm thinking I should probably hedge my bets and get about half out now and then half out when I leave??
 

DeanoT

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I never try to predict direction over the short term - just too hard.

Your idea of half now, half later sounds like a pretty good idea.

Either way, you can never be worse than half wrong.
 

red+black

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If you ever get 90c for the USD, take it. These levels are not sustainable and I think the dollar is more comfortable at ~75c.

Do the maths. Plug in some figures for 90c, 95c, $1, it's not worth it to wait for another cent or two.

I'm hoping to go to the US early next year and will buy 5k soon.
 

DannyJ

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What about 12 months time? Im planning on going to the US then, do you think now would be the best time to buy USD or would it be similar/better in terms of value?
 

Eagle87

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Go you good thing!

Haha... was wondering where you were... it is interesting to watch its rise... clearly much of it is actually US dollar weakness, we have done about the same against the US as most of the Asian currencies, in that sense it seems it probably is sustainable, unless one reckons we warrant a reaming against Asia as well...
 

DeanoT

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Haha... was wondering where you were... it is interesting to watch its rise... clearly much of it is actually US dollar weakness, we have done about the same against the US as most of the Asian currencies, in that sense it seems it probably is sustainable, unless one reckons we warrant a reaming against Asia as well...

Thought I'd wait and see if we get to parity before I start crowing!

Otherwise the arse might fall out of the market like in '08.

Have been loving the RBA Governor's comments about potentially more interest rate rises though!
 

Sasquatch

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If you plan to go in the next 12 months, get a couple of grand of US money now and put it away. That way you won't need to worry about the exchange rate when you go.
 

red+black

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For those that feel the need, you can open a USD or multi-currency account at HSBC or Citibank. There may be other banks that offer the same.

You can also get a Travellex Cash Passport and lock in an exchange rate now (USD, EUR, GBP, NZD, HKD, SGD).

http://www.cashpassport.com/1/en/au/
 

Lakey91

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Just for interests sake, is it common practise to gain a loan from a foreign country?

For example - say I want to buy a house for 500k, can I go to Japan (interest rates fluctuating between 0-0.1% currently), get the loan, exchange into $AU and then buy my house?

Obviously there is a strong currency risk, but you could hedge against this.

Is it possible to do this, and become more profitable than investing with an Aussie back and a cash rate of 4.5%?
 

DeanoT

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Just for interests sake, is it common practise to gain a loan from a foreign country?

For example - say I want to buy a house for 500k, can I go to Japan (interest rates fluctuating between 0-0.1% currently), get the loan, exchange into $AU and then buy my house?

Obviously there is a strong currency risk, but you could hedge against this.

Is it possible to do this, and become more profitable than investing with an Aussie back and a cash rate of 4.5%?

The interest rate differential is exploited by institutions regularly, for the reasons you describe, hence the current strong AUD (today being the exception of course - bloody RBA!).

For individuals, if you can find a foreign bank that will take security of a property in Australia against a foreign currency mortgage, let me know.

I am not aware of any regulations restricting you from doing it, but I doubt foreign banks are in the habit of lending for the purpose of purchasing real assets denominated in a currency other than that of the loan originating country.
 

Eagle87

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The interest rate differential is exploited by institutions regularly, for the reasons you describe, hence the current strong AUD (today being the exception of course - bloody RBA!).

For individuals, if you can find a foreign bank that will take security of a property in Australia against a foreign currency mortgage, let me know.

I am not aware of any regulations restricting you from doing it, but I doubt foreign banks are in the habit of lending for the purpose of purchasing real assets denominated in a currency other than that of the loan originating country.

Aussie expats do it regularly. A number of specialist advisors based in places like Sing & HK will do these loans, you need to be working outside Oz and the loan will usually be done in US dollars. You can get insane rates, basically the same as borrowers in Japan + a margin for the providers...

I was under the impression that there were some regulatory reasons why Aussies couldnt do this directly (while in Oz), something about the foreign bank needing an Australian banking licence if it lends to an Aussie in Oz for housing... I could be completely off base there ...

And I agree re the RBA ... pricks :D
 
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