Wednesday, November 3, 2010

Strong dollar

OK.... this is how Aussie dollar is now ......... almost equivalent to $1 US ....
They were saying that it is good for Aussie buyers ,, we can now buy online stuff that is usually expensive here ,,, hmmmmm,,, how about Prada , Gucci , LV bags...?????
Online shopahloics are getting excited with this news...
But on the other hand bad for the Australian tourism and retailers .....

I dont think it will stay high this long so I guess I have to make the most of it while its high ... so gonna check some online sites ,, might get stuff for a bargain price......

The Australian dollar reached a post float 28-year high overnight, pushing above parity with the US dollar, after the central bank raised the cash rate and the US dollar weakened.

It was the third time in three weeks that the local unit edged above parity with the US dollar.

At 0700 AEDT, the Australian dollar was trading at 99.86 US cents, up slightly from Tuesday's close of 99.85 US cents.

The record high came after the Reserve Bank of Australia (RBA) raised the cash rate to 4.75 per cent on Tuesday afternoon and the US dollar weakened as global risk sentiment improved.

Bank of New Zealand currency strategist Mike Jones said the Australian dollar reached 100.25 US cents just after midnight AEDT following the RBA's surprise interest rate rise.

"The Aussie hit a 28 year post-float high overnight," Mr Jones said from Wellington.

"The RBA rate hike provided the impetuous to get the Aussie over the line."

After touching parity early in the European session the local unit twice nudged above one US dollar during the New York session.

"The first time the Aussie got above parity, it quickly erased those gains, but this time the Aussie seems to be on a much surer footing, so we'll probably see it around the parity mark for longer," he said.

"Not only was there support for the RBA rate hike overnight, but moving through the overnight US session we also had the US dollar on the back foot and global stock markets were on the ascendancy and that added to positive sentiment,' he said.

"So everything went the Aussie's way in the end."

US stocks rose on Tuesday as investors moved into riskier assets following a steep drop in the dollar, putting the Dow Jones industrial average near its highest point of the year.

European stock markets also closed higher, with investors expecting the US Federal Reserve to announce more stimulus measures in an effort to keep the US economic recovery on track.

Mr Jones said the Australian dollar had been assisted by US dollar weakness.

He expects the local currency to trade around parity during the domestic session.

Early on Thursday morning (AEDT) the US Federal Reserve will announce its decision on stimulating the American economy.

The Fed is expected to to buy government bonds from banks to encourage lending and stimulate the flagging economy.

Locally, the Australian Bureau of Statistics releases building approvals data on Wednesday, and on Thursday issues retail trade and international trade figures.

News fro YAHOO7

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