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Money Australian dollar in 2018-19: Experts clash on whether it will crash or surge

20:02  05 january  2018
20:02  05 january  2018 Source:   msn.com

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A rebounding US economy, commodity prices, and a China's economic slowdown are some of the things that will determine how the Aussie dollar performs this year. But depending who you ask, the dollar will sink or surge .

When surveying currency experts from nine different banks, the ABC heard nine wildly different forecasts on where the local currency is headed. Whether the Aussie dollar gets stronger or weaker depends on factors like the speed of US economic recovery, whether commodity prices get higher

Australian dollars in Sydney.© AAP Image/Joel Carrett Australian dollars in Sydney. Depending on which expert you ask, the Australian dollar might sink to 65 US cents or surge to 88 US cents by the end of next year.

When surveying currency experts from nine different banks, the ABC heard nine wildly different forecasts on where the local currency is headed.

It was almost like playing a blind game of darts — except this one affects which investments to make, or when to go on that overseas holiday.

Whether the Aussie dollar gets stronger or weaker depends on factors like the speed of US economic recovery, whether commodity prices get higher, and by how much China's economy slows down.

Australia, New Zealand dollars underpinned by upbeat China manufacturing activity

  Australia, New Zealand dollars underpinned by upbeat China manufacturing activity <p>The Australian and New Zealand dollars held firm on Tuesday as an unexpectedly upbeat survey of Chinese manufacturing activity and broad softness in their U.S. counterpart augured well for Antipodean commodity exports.</p>The Aussie dollar (AUD=D4) made a two-month top of $0.7827 before running into resistance. The next chart targets are $0.7884 and $0.7898, both peaks from October. The kiwi held at $0.7102 (NZD=D4), just off last week's high at $0.7124.

on whether it will crash or surge Uber warns of surge pricing ahead of NYE Ride sharing giant Uber is warning customers o .Depending on which expert you ask, the Australian dollar might sink to US cents or surge to US cents by the end of next year..

Depending on which expert you ask, the Australian dollar might sink to 65 US cents or surge to 88 US cents by the end of next year. When Australia , New Zealand dollars supported by global commodity demand. Aussie dollar eyes off 79 US cents. Australian dollar in 2018 - 19 : Experts

But there was even substantial disagreement among the banks on all of those factors.

Commonwealth Bank, UBS and HSBC were the banks had the most optimistic forecasts.

The Australian dollar will strengthen because of a depreciating US greenback, CBA's senior currency strategist Elias Haddad said.

The Australian dollar continues to rally

  The Australian dollar continues to rally The Australian dollar continued to rally on Tuesday, hitting yet another multi-month high against the greenback. Here's the scoreboard as at 8.10am AEDT. AUD/USD0.7832,0.0029,0.37%AUD/JPY87.91,0.02,0.02%AUD/CNH5.0908,0.0091,0.18%AUD/EUR0.6491,-0.0005,-0.08%AUD/GBP0.5759,-0.0018,-0.31%AUD/NZD1.1015,0.0036,0.33%AUD/CAD0.9791,-0.001,-0.10%After starting the session buying .7803, the AUD/USD rallied on the back of stronger-than-expected Chinese economic data, strength in Chinese stocks and broad-based US dollar weakness, eventually hitting a high of .7844 before easing lower in the second half of the session.

Dollar Index (USDX/DXY) tracks the performance of the dollar against a May 2, 2018 Australian dollar crashes Mar 19 , 2018 A dollar collapse is when the value of the U. Anyone who holds Mar 27, 2018 Many experts believe there will come a tipping point that would cause the dollar to collapse

Experts clash on whether Aussie dollar is on track to crash or surge . If you are going to be in the market for a mortgage or refinancing this year, then it would pay to get go…od advice from a good independent lending specialist.

Although US President Donald Trump finally managed to pass his corporate tax cuts through Congress, "the fundamental downtrend in the US dollar is intact", Mr Haddad said.

There is no doubt that the Federal Reserve will raise America's interest rates this year. But the question is how many times will it happen?

Even within the Fed's own committee, there's significant disagreement on whether it should be two rate hikes, or at least four.

Higher US interest rates, in theory, makes America a more attractive place to invest — luring money away from Australia (and other countries), and resulting in less demand for the local currency.

But there are also other countries with "improving economies and moderately rising inflation" which will announce rate hikes in the near future.

Mr Haddad said this "will have a greater appreciating impact on their exchange rates, than will the Fed lifting interest rates over 2017-18 on the US dollar".

Australia, New Zealand dollars supported by global commodity demand

  Australia, New Zealand dollars supported by global commodity demand <p>The Aussie dollar (AUD=D4) was steady at $0.7826</p>The Aussie dollar (AUD=D4) was steady at $0.7826, having made a fresh three-month top at $0.7845 overnight. It faces stiff chart resistance at $0.7884 and $0.7898, twin peaks from October.

By Houses and Holes in Australian dollar . at 6:21 am on February 9, 2018 | 7 comments. Nothing good. But depends on whether Aussie house prices are crashing as well and our own QE is underway.

Experts clash on whether hitting the gym helps the brain. January 19 , 2018 at 10:49 pm. Another issue, not mentioned here, is conflating the physical model of (Western) medicine with the energetic model of (Eastern/Chinese) medicine and the exercises and related intentions for health.

The bulls' AUD/USD forecasts

CBA also expects commodity prices will "remain supported" due to the global economy experiencing its "first synchronised upswing for a number of years".

As for UBS's position, its global macro strategist Joakim Tiberg believes the Australian dollar will benefit from "a lot of global growth and decent demand for commodities", especially at lower prices.

Even though iron ore prices have rebounded in recent months (and are sitting above $US74 per tonne), they are still a far-cry from its hey-day.

Back in early 2011, Australia's key commodity was worth more than $US180 a tonne.

"But if you look at volume of exports, they have more than doubled since 2011, when the commodities boom was still happening," Mr Tiberg said.

In any event, all three of the 'bullish' banks expect the Reserve Bank to raise interest rates in the second half of this year.

On the other end of the spectrum, Morgan Stanley had the most pessimistic view, and expects the Australian dollar "to depreciate sharply over 2018".

The New York-based investment bank is betting the RBA will keep local interest rates on hold at the record low 1.5 per cent until the second half of 2019 — while the Federal Reserve will lift US interest rates three times this year.

Aussie dollar eyes off 79 US cents

  Aussie dollar eyes off 79 US cents The Australian dollar has yo-yoed higher against its strengthened US counterpart with the focus now on the 78.80 US cent mark.At 0635 AEDT on Thursday, the Australian dollar was worth 78.32 US cents, up from 78.22 US cents on Wednesday.

Experts clash on whether Aussie dollar is on track to crash or surge . If you are going to be in the market for a mortgage or refinancing this year, then it would pay to get go…od advice from a good independent lending specialist.

Posted on May 8, 2018 by Admin Leave a comment. Imports and exports both surged , despite rising trade tensions with the US. The Australian Dollar seemed more focused on local matters.

As for most of the other banks, they expect the next domestic rate hike will happen, at least, by the end of this year — but with no consensus on the number of US rate increases ahead.

"A heavy toll will be taken on the Australian dollar" given that US rates will likely become higher than Australia's within months, according to Westpac's chief economist Bill Evans.

The last time this occurred was about two decade ago, when the Australian dollar plunged as low as 48 US cents.

The bears' AUD/USD forecasts

Morgan Stanley also didn't agree with CBA's upbeat commodities outlook.

"Our commodity team is forecasting flat commodity prices into 2018, largely driven by weaker demand," Morgan Stanley equity strategist Chris Nicol said.

But another factor to consider is the possibility of an economic slowdown in China.

"We expect China's growth rate will reach a comfortable 6.8 per cent in 2017, but anticipate a decent slowdown in 2018 to 6.2 per cent," Westpac's Mr Evans said.

One of the more downbeat perspectives came from JPMorgan's chief economist Sally Auld, who expects the RBA to even cut interest rates in 2019.

"The Trump tax cuts are not a big deal for the US dollar — it may go sideways, and we are not overly bullish about it," Ms Auld said.

"We also don't have high hopes for iron ore, and we see it trading in the low 60s [US dollars per tonne] for the next while."

Aussie dollar teeters on the edge of 79 US cents

  Aussie dollar teeters on the edge of 79 US cents The Australian has extended the lift it gained from strong retail trade figures on Thursday, and is heading toward the 79 US cent mark.At 0635 AEDT on Friday, the Australian dollar was worth 78.92 US cents, up from 78.74 US cents on Thursday.

JP Morgan's view was that the RBA's next move might actually be a rate cut, rather than rate hike like many other economists are expecting.

"Until we see higher wages, the Reserve Bank can't be confident about getting inflation back to target, so this whole story of rate hikes feels a long way off," Ms Auld said.

JP Morgan declined to provide currency forecasts for 2019 on the basis it is a long time into the future, and anything could happen between now and then.

The upside to a weaker local currency it might lead to stronger foreign demand for Australian exports.

He also forecast inflation could be pushed "to the top of the RBA's target band of 2.9 per cent, year-over-year, in the final quarter of 2019".

"This added inflationary impulse, improving labour market and more benign housing market should see the RBA begin a tentative tightening cycle as it looks ahead to conditions in 2020."

But Mr Evans is doubtful on how much demand may come from the nation's major trading partner China.

"If we are speculating on the most significant 'unknown' for 2018 and 2019, the Chinese financial system, particularly for Australia, stands above any other issues that should be worrying us," he said.

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