AUDNZD - Five Year Lows

[Daytr]

I would have thought we will still see parity, however the longer it takes the less likely I think it will happen. I think we will see a high between 1.03 - 1.05.

[Valuegrowth]

I believe NZ Dollar could stay strong against AUD in the short run. However, both NZD and AUD should depreciate against USD continuously. Particularly we may see free fall in NZD and AUD against USD towards end of this year and in 2016. DUOR.

[ynot]

Apart from the long term average that should pull the nz/au nearer to 0.85, can the kiwi realisticly hold parity against the ausi into the future. Is the kiwi economy that much better off than the ausi. Time will tell.

[JBmurc]

Would our dollar be so valued if we had rates as low as AUD.....I think not

Is the fact the Gov and others like to portray a High NZD/AUD as signs of a great booming economy to are peer Aussies across the ditch when in reality it's purely been driven by the worlds investors hunting for safe yield ?

The NZD/AUD is working great for the Aussie economy ..as they own so many NZ businesses their profits in AUD are soaring ..also less Aussies will travel here and more likely spend there tourism dollars at home ....

Food etc how many supermarkets will now both here and across the ditch be stocking Aussie products over more expensive NZ ones ...same for other export markets ..I remember not long ago when we were at record highs against the USD the factory we supplied with a certain fish stock lost one of it's contracts(Russia) to a lower cost supplier nation(USA) ...it pretty much happened within months ....and took much longer to find another buyer..now it's looking like our core export fish market to Aus is going the same way ....

The longer the NZD is high against the AUD the more damage it will do ..Can't believe all media rubbish about a parity party hooray ....happy days we are a rich nation BS ...we our a tiny export driven nation many thousands of miles away from many of our buyers... Aussie has been a cornerstone export market for tens of thousands of kiwi jobs...

And some how we should be Happy about it ....because Property is booming right ...we are taking the wrong path to wealth as a nation

[JBmurc]

Biggest exports to Aus by value - Crude Oil and Gold (the latter likely to drop with OGC limited life in NZ mines)third- Wine

Australia is NZ’s second largest destination (behind China) for our exports of food and beverages ...

BILATERAL TRADE BALANCE is going have a massive turn-round over the next couple of years ...IMHO on the back of the chch rebuild coming to a end ,,property blow-off in general we will also be hit with a huge trade deficit ...a perfect **** storm is coming job losses just the same we seen in Australian auto sector and mining we will get in the property/food/mining etc

[Daytr]

Time to import bananas & pineapples ! ;-)

[Valuegrowth]

http://www.stuff.co.nz/taranaki-daily-news/opinion/67681561/are-we-winning-the-economy-world-cup

Are we winning the economy world cup?

[JBmurc]

http://www.stuff.co.nz/taranaki-daily-news/opinion/67681561/are-we-winning-the-economy-world-cup

Are we winning the economy world cup?

So very true ....Many hardworking kiwis will suffer on the back of property speculation adding very high debt loads to incomes(bubble)

then we have a very open door policy to foreign people with money to become kiwis and adding even more pressure to property in major centres,,,, maybe it's time we have limits on foreigners buying in the main centres with so many towns round NZ have a glut of empty properties push more towards these areas to balance NZ out ....

IMHO we are get very out of balance in this country ... guess it bit like the fergburger down here in Queenstown pretty much 24/7 there in a line running down the street for fergburger yet you could go to Doz other Burger food outlets within a short distance and get a burger just as good but its a "human sheep motive" Wow that place is booming better go there >>>

[dingoNZ]

So very true ....Many hardworking kiwis will suffer on the back of property speculation adding very high debt loads to incomes(bubble)

then we have a very open door policy to foreign people with money to become kiwis and adding even more pressure to property in major centres,,,, maybe it's time we have limits on foreigners buying in the main centres with so many towns round NZ have a glut of empty properties push more towards these areas to balance NZ out ....

IMHO we are get very out of balance in this country ... guess it bit like the fergburger down here in Queenstown pretty much 24/7 there in a line running down the street for fergburger yet you could go to Doz other Burger food outlets within a short distance and get a burger just as good but its a "human sheep motive" Wow that place is booming better go there >>>


I'll give you the Fergburger certainly isn't the same as it was 7 years ago, still bloody good though!

I agree with you on restricting foreign investment into our property market, just take a look at the data showing how much Chinese money is being put down into the Auckland market

[dingoNZ]

Since the China GDP data at 14:00 we're back up too NZD/AUD = 0.9903, parity party, anyone?

[dingoNZ]

aussie unemployment figures just out....much more positive than expected.


A heck of a lot stronger! Seems every time 'parity' is mention the rate falls off a cliff

[JBmurc]

People look at currency as if it were a stock and assume a strong currency is bullish and a weak currency is bearish. This may be for capital movement, but economically, it is opposite. Strong currency reduces exports and weaker currency results in more exports.
M.Armstrong.

[Daytr]

These numbers are notoriously erratic, so although the market will pare their rate cut expectations, lets wait until we see next months & see if there are revisions or a reversal etc. You just need to look at the numbers of Kiwis returning. Net migration has dropped from around 35k p.a. to 2k p.a.
Its probably an exaggerated sample, however its a reasonable indication of the issues around employment in Aussie.
NZD actually strengthened further overnight. I would suggest we will see a surge through parity & that will be the time to jump in & buy AUD.


A heck of a lot stronger! Seems every time 'parity' is mention the rate falls off a cliff

[macduffy]

A heck of a lot stronger! Seems every time 'parity' is mention the rate falls off a cliff

Just a reminder to everyone that there are two parties to every exchange rate. It's not just all about the NZ story.

;)

[dingoNZ]

Not just two parties... we all piggy back off China, eur, us etc etc

[blackcap]

And we are back up to .9949, getting o so close to that magic 1:1 mark. Just wondering if this is the highest it has ever been. I like it for the novelty factor but my Aussie holdings sure are taking a pounding. Swings and roundabouts anyway, but it should not be long till we see parity if this keeps on going.

[dingoNZ]

Lets wait and see how the AUS CPI data comes out at 1.30pm today, QoQ expecting 0.1%

[blackcap]

Lets wait and see how the AUS CPI data comes out at 1.30pm today, QoQ expecting 0.1%

Yep and as we approach parity... boom again an event that pushes it back down again. Good call dingoNZ.

[winner69]

And we are back up to .9949, getting o so close to that magic 1:1 mark. Just wondering if this is the highest it has ever been. I like it for the novelty factor but my Aussie holdings sure are taking a pounding. Swings and roundabouts anyway, but it should not be long till we see parity if this keeps on going.

According to a RBNZ file it reached 1.007 on 18th October 1973. Did spend a bit of time just under the 1.00 mark but that is the only day it went over (on reported daily rates)

On the same date NZ$1 got US$1.48 and GBP0.605

Norman Kirk was PM

[blackcap]

According to a RBNZ file it reached 1.007 on 18th October 1973. Did spend a bit of time just under the 1.00 mark but that is the only day it went over (on reported daily rates)

On the same date NZ$1 got US$1.48 and GBP0.605

Norman Kirk was PM

Cheers winner... before I was born I see.. that is interesting indeed, that we were at US $1.48 and to think in the 80's we were around the 40-50 cent mark vs the US (from memory)
Pretty sure with a rocket under the NZD we can beat that 42 year old record!

[blackcap]

The vagaries of the market I see. From .9940 to .9720 in a week. So no PP this time round but maybe this year still sometime.... or not :)

[dingoNZ]

Westpac Australia are saying they expect PP to be imminent, RBA rate cut in May? Anyones guess as to what happens. With Oil and Iron Ore prices rising and firming up at the tail end of the week and strong than expected CPI you'd expect that the AUD strengthened, question is, can it be sustained. Highly volatile at the moment..

[Daytr]

Well the RBNZ has also now started jawboning down the ccy & has also mentioned they have a mild bias toward cutting rates later in the year.
Just tells me as mentioned at the time the rate hikes they made were a mistake.

[dingoNZ]

And here we were 4 months ago being told by bank economists to 'lock in fixed mortgage rates before the hike'....

[blackcap]

Seems the Aussie may be strengthening as we are now in the low .96's but versus the other currencies we are holding our own. Looks like PP may be a long way off now. Interesting for me when the main stream media start talking about these things its normally a sign that its going to turn. A bit like the old "when taxi drivers start talking about investing in shares its time to sell".

[macduffy]

Seems the Aussie may be strengthening as we are now in the low .96's but versus the other currencies we are holding our own. Looks like PP may be a long way off now. Interesting for me when the main stream media start talking about these things its normally a sign that its going to turn. A bit like the old "when taxi drivers start talking about investing in shares its time to sell".

The AUD is strengthening against USD - and NZD - because the market is anticipating that the recent firming of the iron ore price will continue and cause the RBA to hold off reducing interest rates. Just IMO.

[Daytr]

Is parity now a pipe dream? The sentiment shift that was predicted seems now to be upon us.
I think any bounce back toward parity is a sell.

[winner69]

Is parity now a pipe dream? The sentiment shift that was predicted seems now to be upon us.
I think any bounce back toward parity is a sell.

I see no reason to change my outlook on the NZD:AUD being - there will be short term spikes and tumbles (the noise you see) but with an upward bias and I would not be surprised to see it over parity later in the year.

Currently starting to behave like it did last year when it tumbled down to 90 cents. We'll be right and look forward to parity still

[dingoNZ]

I see no reason to change my outlook on the NZD:AUD being - there will be short term spikes and tumbles (the noise you see) but with an upward bias and I would not be surprised to see it over parity later in the year.

Currently starting to behave like it did last year when it tumbled down to 90 cents. We'll be right and look forward to parity still


Eyes to the RBA cash rate today @ 1630, most thinking a 25bp cut to 2.00%

Should be noted Iron Ore has rebounded nicely to back over $50/tonne in the past 10 days, not sure if will alter the RBA decision but Hockey said he believes long term it will drift to the $30's.

[JBmurc]

I don't believe we will now see parity with the AUD so close but so far....

[stoploss]

Eyes to the RBA cash rate today @ 1630, most thinking a 25bp cut to 2.00%

Should be noted Iron Ore has rebounded nicely to back over $50/tonne in the past 10 days, not sure if will alter the RBA decision but Hockey said he believes long term it will drift to the $30's.

2.00% it is .......

[Daytr]

RBA now has neutral stance on rates, RBNZ looking to perhaps cut. How quickly times change.

[JBmurc]

RBA now has neutral stance on rates, RBNZ looking to perhaps cut. How quickly times change.

Yes looking at re-financing with local ANZ come back with 5.3% 6months told him to go and find a better rate ...this cut should help
deposit rates down longer term fixed down SBS was doing 4.99% 5yr rate yet shorter terms are higher load of banker rubbish ,,swap rates giving the banks even fatter profits than last few years ..

[stanace]

RBA now has neutral stance on rates, RBNZ looking to perhaps cut. How quickly times change.

Has anyone looked at Credit Union ACU offering 6.2% for 12 months?

[JBmurc]

Has anyone looked at Credit Union ACU offering 6.2% for 12 months?

yeah I did see that think they will be same as the other NZCU and be a BB- rating so pretty safe I'd think

[Valuegrowth]

Both AUD and NZD will become brother and sister. We could see bigger fall in NZD and AUD aginast USD and Asian currencies toward end of this year and in 2016.

[blackcap]

What is happening to our $? Under .93 vs the Aud now and also dropping against other currencies. Where are the so called experts that were talking up parity in the media now? It seems to have gone very quiet. This is a huge drop in a short space of time. But I wonder what is driving the move. Is it perceived strengthening in the Aussie economy or the potential for rate cuts here and yet another lower dairy auction?

[winner69]

What is happening to our $? Under .93 vs the Aud now and also dropping against other currencies. Where are the so called experts that were talking up parity in the media now? It seems to have gone very quiet. This is a huge drop in a short space of time. But I wonder what is driving the move. Is it perceived strengthening in the Aussie economy or the potential for rate cuts here and yet another lower dairy auction?

Banks through their guru economic commentators are calling for interest rate cuts and the traders falling for that so down the $ goes.

Noticed how gloomy things have got lately. Almost a self fulfilling prophecy.

Next month it might be all different

[dingoNZ]

Give it time, the RBNZ now have huge pressure to drop rates this year and this is now being factored into the NZD.

This is more strength in the AUD rather than weakness in the NZD, watch closely to Iron ore/commodity prices as they decline so will the AUD. The outlook for Australia isn't exactly rosy for the short/mid term.

I upped my ASX holdings between 0.982 and 0.996 and will monitor the dollar closely. :t_up:

[Daytr]

Self fulfilling or just perceptive? It was pretty obvious that the NZ economy was turning six months ago. Dairy being the obvious case in point.

Dingo, well its both & in fact the NZD has dropped considerably against the USD since the RBNZ started talking down rates etc. The yield trade in the NZD is unwinding by looks. The Aussie has had a bit of a lift comparatively & I agree this maybe temporary.


Banks through their guru economic commentators are calling for interest rate cuts and the traders falling for that so down the $ goes.

Noticed how gloomy things have got lately. Almost a self fulfilling prophecy.

Next month it might be all different

[Daytr]

love your work winner......amazing how a bit of jaw boning from the RBNZ backed up by banking guru's self interest comments can turn rosie into a pile of muck so quickly.
Mean while our rate stands at 3.5% versus Aussie 2% our unemployment rate is better and the government books are far better than AUS

That might be the snapshot right now Snapiti, but markets project forward & the market is saying the picture going forward isn't so rosy & the RBNZ might narrow that interest rate differential. When you have a yield trade in play, there is a lot of fast money that is exposed to the ccy & some of the sharp depreciation will be flow out protecting capital & trying to beat the pack. So from that perspective we may have seen the worst & may well see a settling down after a very swift 8c move against the Aussie.

[winner69]

yes agree but the markets have firmly priced in expectations of a rate cut now.....I am not convinced we will see one at the next meeting

.......unless Mr Wheeler is 'conned' by all this bank propaganda. They (banks) are dead set on getting lower interest rates, no doubt for their own benefit. Hope Wheeler has some spine

As I said a week or so ago OCR cuts this year will not be good in the medium and longer term.

[dingoNZ]

.......unless Mr Wheeler is 'conned' by all this bank propaganda. They (banks) are dead set on getting lower interest rates, no doubt for their own benefit. Hope Wheeler has some spine

As I said a week or so ago OCR cuts this year will not be good in the medium and longer term.

Strettttttttttttttttttttttch those equity valuation out just a touch more.

You're right, it will end in tears

[PSE]

Wheeler must be planning some different levers to cool the housing bubble surely, so that they don't have to rely on interest rates rising and destroying the last pathetic fragments of our export industry?
At least I really hope he had a plan, if not I am with you guys - seems nuts.

[Daytr]

I'm thinking a rate cut around September, however the RBNZ will also be aware that it takes around 6 months for rate cuts to take effect so they may jump the gun early. They will be pretty happy with what their jawboning has achieved in the last few weeks in regards the ccy especially on the Aussie cross.

[winner69]

Retail sales booming according to Stats NZ retail Trade Survey for March

Even guru bank economists from Westpac surprised - quote 'Indeed, relative to our own expectations this was a modest upside surprise - we were primed for the drop in retail prices but the value of spending was even stronger than we had expected. One consequence could be an upgrade to our GDP forecast. '

[Daytr]

Lower fuel prices are probably the main driver I would have thought.
Most predictions I have read is spending to slow as the Dairy price bust hits home in a few months.

[winner69]

Lower fuel prices are probably the main driver I would have thought.
Most predictions I have read is spending to slow as the Dairy price bust hits home in a few months.

Retail sales even stronger if you back fuel sales out (they were down). The extra cash consumers had might have had them buying more laptops, furniture, and meals out etc. but at th end of the highest even of spending for many years

More to the economy than dairy prices daytr - over time there is very little (if any at all) correlation between dairy prices and economic growth in nz

[Daytr]

Exactly as fuel prices dropped people had more to spend on other retail. So the core retail sales increase of 2.9% was which is a bumper number was largely due to lower fuel prices as I said. Total retail sales were up a healthy 0.3% on the previous period.


Retail sales even stronger if you back fuel sales out (they were down). The extra cash consumers had might have had them buying more laptops, furniture, and meals out etc. but at th end of the highest even of spending for many years

More to the economy than dairy prices daytr - over time there is very little (if any at all) correlation between dairy prices and economic growth in nz

[winner69]

Exactly as fuel prices dropped people had more to spend on other retail. So the core retail sales increase of 2.9% was which is a bumper number was largely due to lower fuel prices as I said. Total retail sales were up a healthy 0.3% on the previous period.

Comparing March quarter this yearvv March quarter last year. Actual sales and non of this seasonally adjusted stuff

Fuel sales were down $176m (impact of lower pump prices)

All other sales were up $1.108m ($1.1 billion) or 7% more than last year last year

So plenty saved on fuel but heaps more than what they saved was spent on other things.

The average quarterly increase (over prior year) in core sales has been about 4% - the 7% (close to 6% if we assume that savings from fuel was spent on treats and shouldn't be counted) in March is much stronger than that. I say really strong

Or are we arguing different things?

[blackcap]

Retail sales even stronger if you back fuel sales out (they were down). The extra cash consumers had might have had them buying more laptops, furniture, and meals out etc. but at th end of the highest even of spending for many years

More to the economy than dairy prices daytr - over time there is very little (if any at all) correlation between dairy prices and economic growth in nz

Im sorry but I may have contributed to this one.. bought a laptop just last week. And I ride a bike when I can so do not consume so much fuel.

[winner69]

Im sorry but I may have contributed to this one.. bought a laptop just last week. And I ride a bike when I can so do not consume so much fuel.


Don't be sorry mate ....good you helping retail sales booming as well as keeping fuel use down

Well done

[winner69]

best presented article I have read in a long time.
http://www.interest.co.nz/opinion/75511/will-low-cpi-inflation-justify-ocr-cuts

Basically says the economy is doing well and there is no reason to cut rates at the next RBNZ meeting.
I expect the $ to strengthen against the AUD once all the jaw boning has settle down and the simple facts make up the equation

He a good guy that Rodney Dickens

Truly independent and not swayed by the views of the popular bank economist / commentators who seem to have an agenda to drive and take a rather myopic view of things.

Rodney has worked in the RBNZ as well as for a bank. I think he saw the error of his ways so went out on his own.

[PSE]

best presented article I have read in a long time.
http://www.interest.co.nz/opinion/75511/will-low-cpi-inflation-justify-ocr-cuts

Basically says the economy is doing well and there is no reason to cut rates at the next RBNZ meeting.
I expect the $ to strengthen against the AUD once all the jaw boning has settle down and the simple facts make up the equation

The export economy is damaged by the high AUD, this is reason enough to cut rates if a solution on slowing house prices is found. I am not impressed by the latest attempts though.
http://i.stuff.co.nz/business/money/68515394/Home-buyers-shouldn-t-dance-a-jig-at-new-investor-restrictions

[DarkHorse]

I stumbled on an extremely interesting little article on the NZD-AUD cross from an American (?) currency trader's perspective. It's his favourite macro trade. Amazing to see how closely correlated the AUD-NZD rate and performance of Emerging v Developed markets are - with obvious implications for asset allocation. Well worth a read!
http://seekingalpha.com/article/3186526-a-closer-look-at-aud-and-nzd?ifp=0

[Daytr]

I'm sorry Winner69, your data is very selective & makes the figures extremely flattering to reality.
Q1 2014 was a very poor quarter whereas q12015 was a very good quarter.
Correct me if I'm wrong here you are saying sales were up 7% year on year by comparing Q1 2014 to Q1 to 2015?
That's not a year on year comparison.

From NZ Stats. "March was a boom quarter for retailers, Statistics New Zealand said today.
The total sales value was $19.3 billion in the March 2015 quarter, almost $1 billion (5.1 percent) more than the previous March quarter. Fuel retailing, down due to lower prices, was the only retail industry to have lower sales.
After removing the impact of price changes, total retail sales volumes rose 7.4 percent in the March quarter compared with the same quarter last year."

No doubt retail sales have been steadily growing when the NZ economy has been in a substantial growth mode underpinned by property prices, export prices & National's increased government debt program to fund road building. Retail sales is a lagging indicator obviously and two of the growth industries being diary & forestry are now not what they were.

Here is probably a much fairer reflection from NZ Govt stat. Under what they term is 'Key facts'.

Key facts
For the March 2015 quarter, compared with the December 2014 quarter (seasonally adjusted):


The total volume of retail sales rose 2.7 percent – the largest percentage increase since December 2006. In dollar terms, it was a record increase since this series began in September 2003.
All 15 industries had higher sales volumes.
Electrical and electronic goods retailing recorded the largest volume increase, up 8.9 percent.
The total value of retail sales rose 1.7 percent.


http://www.stats.govt.nz/~/media/Statistics/Browse%20for%20stats/RetailTradeSurvey/HOTPMar15qtr/change_sadj_bargraph.gif



Comparing March quarter this yearvv March quarter last year. Actual sales and non of this seasonally adjusted stuff

Fuel sales were down $176m (impact of lower pump prices)

All other sales were up $1.108m ($1.1 billion) or 7% more than last year last year

So plenty saved on fuel but heaps more than what they saved was spent on other things.

The average quarterly increase (over prior year) in core sales has been about 4% - the 7% (close to 6% if we assume that savings from fuel was spent on treats and shouldn't be counted) in March is much stronger than that. I say really strong

Or are we arguing different things?

[Daytr]

My view is we have had a very healthy clear-out in an extremely overweight trade, i.e. long NZD / short Aussie. The jawboning worked to great effect. Now that it has cleared out & seems to be settling down I would suggest NZD strength returns, albeit perhaps relatively short term. I have no doubt that the NZ economy will weaken over the next six months or so. Obviously there has been a flood of foreign money into the property market, although I expect this to continue, it may slow some with things like National's largely ineffectual CGT. Foreign property ownership is becoming a political hot potato & I think we are likely to see further actions around the fringes at least from Government.
And then there will be the impact of lower export prices, which effectively means less NZDs are bought to convert from USD.
Let alone the impact that lower prices will have on spending from the rural sector.
If the NZD looks like approaching parity again, we are likely to see the same jaw boning from the RBNZ.
Will the economy slow enough to lower rates? Perhaps, but its certainly not a foregone conclusion.


best presented article I have read in a long time.
http://www.interest.co.nz/opinion/75511/will-low-cpi-inflation-justify-ocr-cuts

Basically says the economy is doing well and there is no reason to cut rates at the next RBNZ meeting.
I expect the $ to strengthen against the AUD once all the jaw boning has settle down and the simple facts make up the equation

[Daytr]

Why did the Kiwi just pop higher half a cent? I see banks dropped rates, but that's in anticipation that the RBNZ may drop rates next month.

[winner69]

Why did the Kiwi just pop higher half a cent? I see banks dropped rates, but that's in anticipation that the RBNZ may drop rates next month.

RBA Minutes came out ..... more rate cuts very likely according to the traders

[Daytr]

Thanks. Amasing Aussie unchanged & Kiwi jumps half a cent on an AUD announcement.
Just shows how speculatively driven the Kiwi is driven at the moment with the yield available.
I'm long NZD/AUD cross as of yesterday, so happy days indeed.

[winner69]

Thanks. Amasing Aussie unchanged & Kiwi jumps half a cent on an AUD announcement.
Just shows how speculatively driven the Kiwi is driven at the moment with the yield available.
I'm long NZD/AUD cross as of yesterday, so happy days indeed.

Apparently the Aussie dropped against USD at the time of the release

[winner69]

The rise today in NZD prob due to the Survey of Inflation Expectations which showed expectations of higher inflation than most thought

[Daytr]

Not what I saw, was watching at the time. Aussie pretty much unchanged, Kiwi jumped.
Anyway, see the dairy price dropped along with other commodities overnight.
Payout from Fonterra now at $4.50, but that maybe under pressure.

On a similar note, Supermarket milk prices haven't changed ! Oh well I don't mind supporting our farmers. ;-)



Apparently the Aussie dropped against USD at the time of the release

[winner69]

Not what I saw, was watching at the time. Aussie pretty much unchanged, Kiwi jumped.
. ;-)

Sorry mate for doubting you, just proves I shouldn't believe everything I read in the papers

However, the dollar plunged one-third of a cent to US79.60¢ – its lowest for a week – after the release of the Reserve Bank minutes.
http://www.smh.com.au/business/markets/currencies/rbas-easing-notice-cant-keep-the-australian-dollar-down-20150519-gh4x11.html

Suppose it was the word plunged that attracted my attention

[Daytr]

Its ok, I didn't take it that way. ;-)

The USD rallied generally overnight with commodities & ccys whacked.

[Daytr]

Any thoughts on the Kiwi/Aussie cross anyone? I had a resting order to buy Kiwi against AUD that just got hit at 1.0785.

Cheers Daytr

[Pumice]

Any thoughts on the Kiwi/Aussie cross anyone? I had a resting order to buy Kiwi against AUD that just got hit at 1.0785.

Cheers Daytr

Brave entering just before the RBA rate call tomorrow, no doubt they will continue jawboning the AUD down.
If they cut (which seems unlikely) the AUD/NZD would fall pretty hard.
Think RBNZ ocr is early next week.

[Daytr]

I jobbed out last night for 3/4 of a cent profit & then reset entry level and now back in again.
I still think short term the Kiwi will strengthen against the Aussie.

[JBmurc]

I here on the radio...... on average NZ Dairy farmers will be in the red some 150k NZD this year ...now we could well see prices stay low for some time(or long term with so much worldwide production on stream $4-5 could well be the average) ...

[Daytr]

Yep I agree JB & I think many have underestimated the hit to the NZ economy that is coming.
Still a little way off though I suspect.

[winner69]

Yep I agree JB & I think many have underestimated the hit to the NZ economy that is coming.
Still a little way off though I suspect.

I posted this link to this analysis a while ago. Counterintuitively falls in dairy prices don't appear to stuff the economy. But with x-rate its the traders who rule by creating as much as noise as possible.by reacting to any snippet of econ info.

http://www.sra.co.nz/pdf/DairyPricesAug14.pdf


A couple of extracts -


Since 1992 there have been seven significant falls in dairy product prices including the latest fall and in only one of these was there are recession and this was when the financial crisis struck in 2008/09 and had a major negative on a number of things.

And


Interestingly, between 1992 and 2007 the correlation between dairy product price inflation and annual GDP growth was -0.45 ........All of the five significant falls in dairy product prices prior to 2008 coincided with above average economic growth.

[Daytr]

Farmers would be loving it if they were going to get the $6/kg in the article, but instead they are going to get $4.40.
So that $4.5Bln+ is now a lot +++ more likely over $7Bln.
There will be farmers that go to the wall on this, how many will depend on if & when the price recovers, however NZ is now one of the most expensive producers of dairy product in the world because of intensification & dairy conversion on unsuitable land.
Will it cause a recession? Who knows, but I prefer to look at current facts rather than relying on what happened in the past.

I would suggest this is by far the biggest fall in dollar value & [perhaps percentage terms for dairy. In dollar terms for any export market in NZ.
In relative dollar terms it would be similar to the wool glut of the late 70s or something similar.
The purse strings in places like the Waikato are already drying up & it will impact a hell of a lot more than just farm buildings.
Importing of feed, new machinery, fertilizer, wages among others will be first things to be wound back.

Its a cliché, but its different this time, as previously we haven't had the conversion of so many farmers to dairy as we have seen in recent years. We now have a dairy industry in sheep heartlands of the Hawkes Bay and Canterbury. So its more wide spread & the price fall much bigger.

[Pumice]

I jobbed out last night for 3/4 of a cent profit & then reset entry level and now back in again.
I still think short term the Kiwi will strengthen against the Aussie.

AUD raced away after their strong GDP result. Still optimistic for the NZD V AUD?
Shorting NZD/USD seems an easier play to me.

[winner69]

Farmers would be loving it if they were going to get the $6/kg in the article, but instead they are going to get $4.40.
So that $4.5Bln+ is now a lot +++ more likely over $7Bln.
There will be farmers that go to the wall on this, how many will depend on if & when the price recovers, however NZ is now one of the most expensive producers of dairy product in the world because of intensification & dairy conversion on unsuitable land.
Will it cause a recession? Who knows, but I prefer to look at current facts rather than relying on what happened in the past.

I would suggest this is by far the biggest fall in dollar value & [perhaps percentage terms for dairy. In dollar terms for any export market in NZ.
In relative dollar terms it would be similar to the wool glut of the late 70s or something similar.
The purse strings in places like the Waikato are already drying up & it will impact a hell of a lot more than just farm buildings.
Importing of feed, new machinery, fertilizer, wages among others will be first things to be wound back.

Its a cliché, but its different this time, as previously we haven't had the conversion of so many farmers to dairy as we have seen in recent years. We now have a dairy industry in sheep heartlands of the Hawkes Bay and Canterbury. So its more wide spread & the price fall much bigger.

Good points. I will reflect on them

But interestingly the current $4.40 plus 20-30 cents dividend is the average payout from 2000 to 2007. Prices are only reverting to the average after a period of boom times and high prices.

I wonder where the 'excessive' profits have gone over the last few years? I would hazard a guess a lot has not "trickled down" into the towns and cities. This a lot of the touted billions that is being taken out of the economy was never there in the first place.

[dingoNZ]

Very happy I picked up some ASX stocks when it was around 0.99. Sold out entirely of HNZ @ $1.31 and move it all across to ASX holdings, sitting on a nice wee currency buffer at the moment. All eyes will be on the RBNZ announcement next week.

[Daytr]

Yeah it certainly did & I stopped myself out & re-entered at half a cent higher.
I don't think the RBNZ will drop rates next week, but its possible.


AUD raced away after their strong GDP result. Still optimistic for the NZD V AUD?
Shorting NZD/USD seems an easier play to me.

[Daytr]

They are reverting to a mean, but meanwhile costs aren't other than fuel. As I said NZ has become one of the most highest cost producers of dairy in the world for a large scale producer & this wasn't the case 10 years ago. Dairy land values has probably doubled in that time as well.
Well farmers, the better ones at least, rightly so use those billions to pay off debt & save for a rainy day. Well its raining.
Logs are obviously down as well, however beef & lamb prices are doing well.
The problem with the dairy conversions is that the capital outlay is high so its not like they can just switch back, well they can, if they can afford the stock, but the capital outlay or debt still remains.


Good points. I will reflect on them

But interestingly the current $4.40 plus 20-30 cents dividend is the average payout from 2000 to 2007. Prices are only reverting to the average after a period of boom times and high prices.

I wonder where the 'excessive' profits have gone over the last few years? I would hazard a guess a lot has not "trickled down" into the towns and cities. This a lot of the touted billions that is being taken out of the economy was never there in the first place.

[JBmurc]

In some area's dairy farmers were paying more per hectare than the lifestyle block buyers.

Which has lead to many farmers taking on way too much debt ....how many years can the average Dairy farmer survive at current losses ..guess we will find out in time

[winner69]

Traders (who want noise and plenty of it) and bank economists / commentators (no doubt for selfish reasons) calling for OCR cut this week

Will Wheeler be a wimp and give in to their 'demands'? Hope not


Guy on radio this morning said if not rate cut Thursady NZD will spike up, maybe as much as 3 cents

[winner69]

wheeler has got what he wanted by jaw boning the Kiwi $ down........absolutely no show now of a rate cut....the $ will bounce.......... trading to it

But we have even reached the stage where in those bank commentary things some are even suggesting what Wheeler could say ...Westpac in particular suggesting the paragraphs he writes. Weird.

They are desperate .....Wheeler will bow to popular opinion which has a rather myopic view of the situation. Ans snaps will lose money on this trade.

And in a couple of years time we will have interest rates much higher than they needed to be.

[winner69]

snaps made a bundle last night so took some off the table this morning.
Wheeler won't cut rates this thurs and I will make even more money....besides winner it is time you were wrong.

Well done snaps

I sort of hedging my bets a bit eh. Wheeler shouldn't cut rates but they may have got to him and he will feel compelled to cut.

Should be 90/10 to hold but 50/50 if he sucked in .......so now roughly 70/30 to hold

[winner69]

Snaps -all primed and ready to go to trade that spike (up hopefully or down) at 9 am

Maybe for a selected few its 8.59 am .....how cynical

[blackcap]

Snaps -all primed and ready to go to trade that spike (up hopefully or down) at 9 am

Maybe for a selected few its 8.59 am .....how cynical

Rate is cut.. wonder what will happen today?

[Daytr]

Cut 25bps! Funny, in the last couple of days I started to get the gut feeling they may cut, but was probably 50:50 on it rather than 25:75 previously. NZD down around 2% at one point! RBNZ indicating more cuts as well. Seems their economic forecast is quite different to the government's.

[winner69]

snaps is very wrong ........I may have to employ you for financial advice winner

Yes the bankers got their way and Wheeler fell for it

Pain ahead in the years to come I fear ... OCR back to 5% plus in 2017 methinks as Wheeler tries to dampen down things

And we thought he had to take a forward looking view

[Daytr]

Perhaps he does Winner, but his view is more aligned with mine than yours or the political spin of the government. ;-)

[winner69]

Perhaps he does Winner, but his view is more aligned with mine than yours or the political spin of the government. ;-)

Daytr, Obviously we will continue to disagree for a while at least

Hey mate, don't like that inference I have been sucked in by the political spin of the government.

[Daytr]

Winner, that's your inference it wasn't mine.
All I said was that your outlook is aligned with the Government's.

[winner69]

Banks celebrating their win today, even better news for them as no mention of any future increases but more cuts likely

As foreign wholesale funding rates creep up (ie higher costs for local banks) they now every excuse to screw NZ depositors even more to make up the shortfall.

Well done Cam Bagrie et al, you have done a good job for your bosses.

[winner69]

Winner, that's your inference it wasn't mine.
All I said was that your outlook is aligned with the Government's.

Sorry, I read too fast. There is an 'or' in the sentence after all

Was rather tongue in cheek comment anyway

[Daytr]

How do the banks win ?
Lower interest rates usually means tighter margins for banks.


Banks celebrating their win today, even better news for them as no mention of any future increases but more cuts likely

As foreign wholesale funding rates creep up (ie higher costs for local banks) they now every excuse to screw NZ depositors even more to make up the shortfall.

Well done Cam Bagrie et al, you have done a good job for your bosses.

[Daytr]

Well the banks dropped lending rates for one & two year as the curve dropped in anticipation of the RBNZ lowering rates.
Banks will make much better margins of a higher interest rate environment than a low one, so overall the RBNZ lowering rates is not helping the banks at all, quite the opposite.

[winner69]

You may be right daytr ....seems like everybody is reading the same papers

I still to be convinced though but the trick is to prosper if one can prosper from the commentators myopic view of the current state of the economy. Thinking about that

http://www.interest.co.nz/opinion/75917/reserve-banks-move-cut-interest-rates-indication-economy-deteriorating-faster-had-been

[Daytr]

Well its been my view for a while & in fact I said when the RBNZ raised rates last year I said it was a mistake, but they were between a rock & a hard place due to the Auckland property market & immigration. Well they have targeted the Auckland property market recently, not sure what impact it will have, but some & now they can have policy that is dictated by the whole country's position rather than just one out of control property market.

[JBmurc]

Good for this exporter sector worker.and the spine of NZ's economy ....sub 90c NZD/AUD fine by me ....the idea of higher rates has and will continue to be a pipedream..of the media and those that believe high NZD = great times !

Just because the flood of foreign money & people into the likes of the Auckland Property market shouldn't be the main driver of RBNZ policy
but of the immigration office ...having money shouldn't equal easy entry into NZ and it's property market....must be a stand down period IMHO maybe new builds only or rent first 5yrs to foreigners

rant over

[blackcap]

aussie unemployment rate just came in...they added 4 x as many jobs as predicted....unemployment rate down to 6%.....cross rate getting smashed.

Thanks for that Snaps. I wondered earlier if it was going to breach .91 and then saw it at .9039 and wondered what had happened. Still same on US cross so assumed it was Australian influenced. That is a double whammy. Not that I am complaining... topped up on Aussie stocks around time of the "parity" talks.

[Daytr]

Nice rant though JB! ;-)

[macduffy]

Well its been my view for a while & in fact I said when the RBNZ raised rates last year I said it was a mistake, but they were between a rock & a hard place due to the Auckland property market & immigration. Well they have targeted the Auckland property market recently, not sure what impact it will have, but some & now they can have policy that is dictated by the whole country's position rather than just one out of control property market.

And savers, once again, come to the rescue of over-committed dairy farmers and Auckland property owners!

[winner69]

Snaps, obviously the economy is rooted and needs a decent boost. I see some bank commentators now touting cuts in July and September, all the way to 2.75%

Looks like NZD to fall even further. You hanging in there for the ride?

Next shock (noise) is GDP number out soon. Lower than expected they say making that bet even better.

That how you playing it?

[JBmurc]

yep on a slippery slope from here.
Jeez I had a end of year target of 70 USD(mentioned that on the NZR thread a while back)
Currency traders\speculators won't like the kiwi now as we always get more than one cut......lets face it they are the ones that drive the currency up or down
I did take out a hedge long the kiwi AUD but only to protect profits on a AUD short term deposit I want to bring home in a month......very very happy with 1.1050

Bring it on sub 70c Vs USD 85c Vs AUD ....negative will lose some buying power.... fuel will increase ...New TV's, Autos etc and other luxuries will increase ....boo hoo >>

But much brighter for many hard working kiwis

[Toulouse - Luzern]

And savers, once again, come to the rescue of over-committed dairy farmers and Auckland property owners!

I feel the same as you on this MacDuffy.

[Hoop]

Bring it on sub 70c Vs USD 85c Vs AUD ....negative will lose some buying power.... fuel will increase ...New TV's, Autos etc and other luxuries will increase ....boo hoo >>

But much brighter for many hard working kiwis

I'm a person that believe in the the wealth and health of a Country's Economy is measured by its currency.....

The unfortunate fact of life JB is the hard working kiwis have to rely on the rich bastards in industry. ...At the moment these rich bastard's investment money is leaving NZ in droves...Both Kiwis money and overseas peoples alike.

An already trending down NZ$ followed by a cut in the OCR.. Thanks Mr Wheeler for suddenly making NZ an unattractive place to invest in...

I hope Mr Wheeler is in control of his sledge hammer.....as there are some very delicate bubbles in our economy.

[Daytr]

Hoop, I agree, but its not his job to continually inflate bubbles, in fact quite the opposite. They have to work with the policy given them by the government & sometimes the RBNZ policy will need to negate poor government policy say in regards Auckland housing.
There is still plenty of money pouring in, due to other reasons & mainly the woes of other countries has seen Kiwis come home in droves.
There are also industries like tourism & exports that will benefit from a weaker dollar, so it certainly isn't all bad. In fact its only the 'hot' money that you are referring to & that would have left at some point anyway. Real investment is made more attractive by a lower ccy & lower interest rates.

[winner69]

Economy well and truly rooted according to headlines--- up a miserly 0.2% seasonally adjusted (the yanks would say 0.8% annualised)

March quarter activity +2.5% up on pcp, annual growth 3.2%

Traders happy, NZD down

Daytr happy, more rate cuts sooner than later

[Daytr]

Well the lower Kiwi overall will be much better to NZ as we are an export led economy.
I think the RBNZ will be very aware that interest rates are already historically low & I wouldn't expect too many more cuts.
2-3 more 25bp cuts would be my pick. Enough to get the dollar where they are more comfortable to offset lower commodity prices.
Of course this will make NZ property cheaper for foreign buyers, so its not all what the RBNZ would like.

[JBmurc]

New Zealand's economy grew slower than expected in the quarter ending March, prompting analysts to forecast another interest rate cut next month.

Gross domestic product (GDP) rose by 0.2 percent in the March quarter, down from 0.7 percent in the previous quarter, the government statistics agency said Thursday.

The lower growth reflected a 2.9-percent fall in primary industries, the largest fall since September 2010, according to Statistics New Zealand.

"Oil and gas were big factors in the lower GDP growth this quarter," national accounts manager Gary Dunnet said. "There was less extraction and exploration, as international prices fell."

Agriculture fell by 2.3 percent in the March quarter, dragged down by lower milk production.

Forestry production and exports of forestry products were also down.

A 2.4-percent increase in retail trade and accommodation helped to offset the decrease in primary industries.

Possible contributors to retail trade and accommodation includes the 2015 Cricket World Cup, which New Zealand co-hosted with Australia, and more visitors during Chinese New Year than in the past.

International tourist spending in New Zealand was up 2.3 percent in the March quarter.

Despite lower quarterly growth, annual GDP growth was still strong at 3.2 percent.

The size of the economy was 239 billion NZ dollars (165.17 billion U.S. dollars) for the year ended March.

An Economic Note from the ASB Bank said the quarterly growth was weaker than the market's median expectation of 0.6 percent.

It said the figures would be a "significant surprise" to the Reserve Bank of New Zealand (RBNZ), which cut the official cash by 25 basis points to 3.25 percent earlier this month and signaled another possible cut in September.

"We now expect this rate cut to come in July rather than September," said the Economic Note.

Finance Minister Bill English said the figures showed solid, sustainable economic growth that had seen 74,000 jobs created in the past year, and average annual wages rising faster than inflation.

"The lower dairy output was in line with Treasury's forecasts, which see the economy continuing to grow at around 2.8 percent on average over the next four years," English said.

"This results highlights that New Zealand is closely tied to international markets, and risks are ever-present."

[Valuegrowth]

I became bear on NZD and AUD from 2013/14 onwards and still I am one of the big bears for both AUD and NZD due to new development in the currency market. Now I am one of the big bears for housing markets in Auckland, Sydney and Melbourne.

My ideas are not a recommendation to either buy or sell any property, security, commodity, or currency. Please do your own research prior to making any investment decisions.

[Daytr]

I agree winner, re Auckland particularly. Its all happened too fast & many people will see the potential to cash up & buy in the regions. Regional property is about to explode in my view as a result. Sydney & Melbourne & too a lesser extent Auckland depend a lot on immigration so if that holds up so to might property. Eventually however it will come unstuck.

[winner69]

Well the Greeks have given the fingers to Germany et al talking about having referendum. The insiders will hate this, they can't control referendum outcomes.

That'll teach them in trying to bail out the banks by essentially transferring the debt to the Greek tax payers. Tough bikkies guys, you should have been more responsible in the first place and not letting Greece get into this state to start with.

Whatever things will get uglier for the Greeks. But what's the point of 'raising taxes' so the extra bit can go to rich creditors.

[winner69]

No cash left in Greek banks .....what then happens to the NZD

[Daytr]

If there is a Grexit, which seems to have now become more likely, (but obviously could go either way) you would think the dollar rallies at least initially anyway, so Kiwi lower. All will depend on the fallout and its the first time I have heard the likes of Key playing down a Grexit, so it appears they think it will happen. The debt has largely been privatized, (Banks bailed out again) so its now the European taxpayers & IMF mostly on the hook.
Criminal how bail out funds to Greece was purely to ensure commercial banks got their money back & taxpayers pick up the bill.

[JBmurc]

Global Glut
Domestic output in May reached 18.4 billion pounds, the most in any month, and is on pace to reach a record 208.7 billion pounds this year, the U.S. Department of Agriculture said June 18. Globally, production will rise 2.1 percent to a record 582.52 million tons as top exporter New Zealand sells the most ever and the European Union ends limits on dairies that had been in place since 1984, the USDA said.

http://www.bloomberg.com/news/articles/2015-07-01/milk-spilled-into-manure-pits-as-supplies-overwhelm-u-s-dairies

[Bobcat.]

Our currency has plummeted over the past two months from 77.34 (April 28) to now 66.70 on its cross with the USD. That's 10.64 / 77.34 =13.7%. Against the Pound it's even more = 1.946 to now 2.336 = .4 / 1.946 = a whopping 20% !! ..in just two months.

This is not Greece. Our currency is getting way oversold now. I've just loaded up my FOREX reserves to come in strong on any sign of a rebound, and with a cheeky bid in at 66.50.

[Joshuatree]

Against the Aussie we have dropped from re 99.7c to 87.7c in re a month , thats a 12 % change!!. Sure makes all my aussie shares look good on paper though; turbo charged..

[Bobcat.]

Time to move some money back across the ditch me thinks, JT...even if it does mean feeding the coffers of banks charging exorbitant fees via their FOREX spreads. ANZ for example has the audacity to state on their FOREX contract note 'transaction fee = zero" . They must think we're idiots. Their hidden fees amount to almost 2%.

[Daytr]

Try NZ Forex BC, I think their spreads are fairly tight comparative to the banks.
I wouldn't be surprised to see the NZD go to 1.18 over time.

Cheers Daytr

[JBmurc]

Against the Aussie we have dropped from re 99.7c to 87.7c in re a month , thats a 12 % change!!. Sure makes all my aussie shares look good on paper though; turbo charged..

I'm gutted to not have sold our house round this time many were dreaming of parity ...would have put a good chunk of funds into AUD

[Bobcat.]

I've just come in on the AUD/USD at 75.14. It's plummeted this afternoon after both disappointing Retail Sales figures and a lower than forecast Chinese Services PMI. Expecting a decent rebound to somewhere around 76c tomorrow morning.

The AUD/NZD cross has also fallen a lot over the past 24 hrs, and IMO will continue to trend down over the next few weeks closer to 1.10.

Discl: Long now on the Kiwi and Aussie both against the USD.

[Daytr]

I hope you are right BC as I'll jump back in.
Steven Topliss economist at BNZ came out yesterday saying NZs chances of going into recession have increased & I agree with him, although the much lower NZD may save the day.

[Hoop]

Yes recession risk increases...A tell tale sign is the inverting of the yield curve..

Back in March there was a trending move towards an inverted yield curve (http://www.investopedia.com/terms/i/invertedyieldcurve.asp). With the RBNZ interest rate cut that trending move was eliminated.....Now this trending is back..with the 5y Swap very close to causing a partial inverted yield curve event.

The option to eliminate the inversion threat is drop the short term rate again and again in an effort to keep it lower than the falling long term rates.


Todays table shows a big drop....



NZ OCR (http://www.rbnz.govt.nz)
3.25

https://www.anzsecurities.co.nz/directtrade/images/spacer.gif



10y Swap
3.87
-0.06
https://www.anzsecurities.co.nz/directtrade/images/spacer.gif
-1.53%



3m Bank Bill
3.18
-0.04

https://www.anzsecurities.co.nz/directtrade/images/spacer.gif
-1.24%


5y Swap
3.30
-0.06

https://www.anzsecurities.co.nz/directtrade/images/spacer.gif
-1.79%

[winner69]

I hope you are right BC as I'll jump back in.
Steven Topliss economist at BNZ came out yesterday saying NZs chances of going into recession have increased & I agree with him, although the much lower NZD may save the day.

With the likes of Topliss and Bagrie influencing things so much is Wheeler almost irrelevant (or redundant)

Pity we are talking our way into recession territory

For once Key seems the only sensible one at the moment

[Daytr]

I would suggest burying your head in the sand as Key basically has this morning is hardly sensible. I loved this bit. "Yes dairy prices are down a little bit" LOL
There are obvious risks to the NZ economy right now & they should be respected & acted upon.
Why do you think the RBNZ has been lowering rates? They can see the same.
You can't expect things like dairy prices to get absolutely smashed & not have a reasonable negative impact on the economy.
And now we have external factors such as China & Greece adding to the mix.
NZ as an export led economy relies on global growth & global consumption.
The problem for Key is, it doesn't suit his plans for the 2017 election of having the budget back in surplus.
He's borrowed to the hilt since he has been in power & now he may have to start spending more, meanwhile the tax take is likely to take quite a hit.
More debt.
I hope they are wrong & the BNZ was saying recession is a more likely chance not the probable prognosis.

[macduffy]

Pity we are talking our way into recession territory


So right, winner!

Too many commentators who automatically see the half full glass as empty. But then, they're probably talking their own books!

[Daytr]

Macduffy, there is such a thing as false optimism as well.
NZ business confidence survey down to three year lows...

[macduffy]

Macduffy, there is such a thing as false optimism as well.
NZ business confidence survey down to three year lows...

Hardly surprising when dairy prices have taken a hammering and the media continually focuses on the point. But there's still a lot going right for the NZ economy that doesn't get that attention.

[Daytr]

Well the dollar is being hammered & interest rates lower, all good things for the NZ economy & they are getting plenty of coverage.
Tourism gets a fair shake & Auckland property you can't get away from in the media.
What other areas would you like highlighted?
Unfortunately its the way of the world that bad news always travels faster & wider than good news.
Back to my original point was that best be on the front foot about it rather than as Key is saying, if it gets bad we might do something.

[macduffy]

Back to my original point was that best be on the front foot about it rather than as Key is saying, if it gets bad we might do something.

Seems I must have misunderstood your original point, Daytr? I didn't read anything there about getting on the front foot.

[Daytr]

"The problem for Key is, it doesn't suit his plans for the 2017 election of having the budget back in surplus.
He's borrowed to the hilt since he has been in power & now he may have to start spending more, meanwhile the tax take is likely to take quite a hit.
More debt."

[macduffy]

Aah, I see now.

I originally read that as a criticism of JK, missing that it was actually advocating more borrowing at this point. No argument from me there, when/if such stimulus becomes necessary.

[Daytr]

The criticism was that they have kept on borrowing through the good times & now we may be heading into a period where more government spending / borrowing is required & government debt is going to have to increase more from an already elevated level.

Cheers Daytr

[winner69]

So right, winner!

Too many commentators who automatically see the half full glass as empty. But then, they're probably talking their own books!

Yes definitely pushing their own barrow, macduffy. And the crowds are joining in.

Westpac put out their Local Knowledge Report today. Of the 20 economic series they monitors net 30% (difference between % rising less % falling) are rising. Not often that high. Heaps more things doing better than last month than doing worse - glass more than half full.

But because it's slightly down from previous report the commentary is all about the sky falling in and we must have interest rate cuts and all that - wonder what their motive is?

[Daytr]

What is doing better? The obvious from me is sheep & beef, tourism (lower dollar), so yep agree its not all negative, but be interested in hearing what other industries you think are doing better ?

[macduffy]

What is doing better? The obvious from me is sheep & beef, tourism (lower dollar), so yep agree its not all negative, but be interested in hearing what other industries you think are doing better ?

Well, for a starter, any business, in any industry, that exports, is benefitting from a lower NZD!

[Daytr]

Yeah sure, so they are benefitting from a weaker economy in a sense.
That's been my bias from the start.
Kiwi much lower & will benefit NZ as an export led economy.
Kiwifruit did very well this year.

[winner69]

What is doing better? The obvious from me is sheep & beef, tourism (lower dollar), so yep agree its not all negative, but be interested in hearing what other industries you think are doing better ?

Daytr, here's that Westpac report and the suite of the 20 things they look at

You not this Michael guy are you .....commentary is very much what you are saying. I mainly have a look at the pictures .....more things going up than down is what I see

You don't need to read the last few pages by the way

https://wibiq.westpac.com.au/wibiqauthoring/_uploads/file/New_Zealand/2015/July_2015/NZ_Local_Knowledge_7_July_2015.pdf

[Daytr]

Haha, do you think if I had a real job I would be spending so much time on here!
Interesting he used agricultural out in tons rather than dollars, which would be a much better chart to use.
What is quite apparent is that we need to host another world cup!

[Daytr]

Interesting pullback in the Kiwi/Aussie cross after Key did the NZ economy no favours yesterday after the market interpreted Key's comments that the Kiwi had moved to far too fast. Doesn't the market realize this guy was in sales, not a trader! ;-)
Either way its presented what I think maybe an opportunity prior to the RBNZ decision on rates.
If they cut 50, watch the cross blow out back toward at least 1.14.
Eventually I think we are heading to 1.18 but possibly quite a bit weaker as that would really only be an historic average rate against the Aussie.

[JBmurc]

Yeah sure, so they are benefitting from a weaker economy in a sense.
That's been my bias from the start.
Kiwi much lower & will benefit NZ as an export led economy.
Kiwifruit did very well this year.

Yes a major boom for the exporters margins increasing from the currency weakness ...sadly many have to deal with lower commodity prices
still could have been so much worse had the NZD stayed high ... looking forward to 1.18 AUD / NZD should finally get a pay rise

[Valuegrowth]

http://www.cnbc.com/2015/07/20/commodity-currencies-in-decline.html

Commodity currencies: Who's the ugliest of them all?

[winner69]

At this rate might need to get ready for those parity parties

[winner69]

AUD/NZD cross rate driven by relative economic conditions in each country

NZ economy purring along nicely while Australia economy heading to a hard landing according to Macquarie analysts

http://www.smh.com.au/business/the-economy/housing-bust-now-the-greatest-recession-risk-say-investment-banks-20151012-gk6pjz.html

Parity on th agenda again

[winner69]

89....90.....91....92....and today 93 .....





.........parity

[winner69]

Wheeler will succumb to bank commentators and cut the OCR today ....big mistake

If he does show some common sense and hold the NZD will surge

http://www.interest.co.nz/bonds/79019/commonwealth-bank-australia-strategists-see-sharply-higher-kiwi-dollar-and-wholesale

[JBmurc]

AUD/NZD not surging ....I do see a spike higher most likely on a worst Aus outlook ...But no Parity party IMHO Drought conditions here will hurt along with overextended debt in housing keeping rates lower for longer

[Valuegrowth]

We could expect some support for AUD in the short run. However, from 2016 onwards we could see downtrend for both AUD and NZD again.

http://www.businessinsider.com.au/the-australian-dollar-is-higher-despite-the-us-rate-hike-2015-12

The Australian dollar is higher despite the US rate hike

[Daytr]

Any further thoughts on the Aussie/ Kiwi cross for 2016. Its hard to get too excited other than history says its very high here. I keep buying at 1.05/6 wish but it keeps coming back.

[winner69]

Any further thoughts on the Aussie/ Kiwi cross for 2016. Its hard to get too excited other than history says its very high here. I keep buying at 1.05/6 wish but it keeps coming back.

My view hasn't changed much from a few months ago.

Based on relative economic growth and interest rates outlooks I expect to see the NZD remaining at these current 'high' levels (maybe about right eh) but as before expect some short term tumbles and spikes. Parity still on the cards when one f these spikes occur.

Interesting head and shoulders pattern forming on chart - maybe NZD/AUD at 85 then?

[ynot]

See next post

[ynot]

With regard to the classic "head and shoulders pattern" forming here.
It is starting to look that way but is such a pattern able to predict the direction of this trade ?

[winner69]

NZD still pretty strong - NZD/USD through 0.67 and NZD/AUD above 0.94.

Recognition that our economy doing more than OK in relative terms

[ynot]

If interest rates are reduced we will see 0.90 . Dairy price and inflation figures also contributing.

[Hoop]

With regard to the classic "head and shoulders pattern" forming here.
It is starting to look that way but is such a pattern able to predict the direction of this trade ?
Ynot..The H&S pattern is the most reliable of all the chart patterns, so basically yes ,,,the predictability is high..
First of all the NZ$VA$ H&S pattern is still forming..It has to be completely formed (established) before one can stat assessing the probabilities of an outcome..... The H&S pattern is established when it reaches its already formed neckline again..So the NZ$ has to fall to its neckline which is about 0.86 atm.

The predictability is very high if NZ$ breaks its neckline (H&S pattern established) it has only a 4% failure rate of not falling 5% below the neckline line break..There's a 54% failure rate at the -20% (Bulkowski)...so as you can see with the chart below if there is a neckline line break at say 0.86c then there is a 46% chance that the price will exceed below 0.69c.

see http://thepatternsite.com/hst.html#HST0

As Winner rightly points out the currency is a reflection of the economic health of its country, so a fall to < 0.69 would indicate some sort of economic collapse that could occur to a much lesser degree in Australia..

If one assumes that the currency will not go lower than 0.86 by June then the same assumption would apply that the H&S pattern will not established...

The downward sloping neckline is a worry in that a H&S pattern does not have to established with a long slow decline to say 0.86 by Xmas 2016...however if there is a neckline break, it would indicate a good chance "happening" the NZ economy would experience a sudden slump.

The good scenario is that the NZ$ could keep wavering around its 0.88 - 0.95 and the H&S pattern fails to become established..or better still break parity:D.



The chart below has dotted line Target price..I wondered if to include it,,but I did anyway...This dotted line is line in the sand using probabilities of a "happening" and is highly significant (85% chance the dotted line will be reached if the neckline is broken)..the TP dotted line is not a support or resistance line therefore it should have no effect on the outcome of the NZ$ price..

EDIT: chart error..Primary Support 0.95 should read Primary Resistance 0.95

http://i458.photobucket.com/albums/qq306/Hoop_1/NZvA%2016022016.png (http://s458.photobucket.com/user/Hoop_1/media/NZvA%2016022016.png.html)

[JBmurc]

Dairy prices fall for fourth time in a row at GlobalDairyTrade auction

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11590485

pipe dream that NZD will stay strong .... once this housing bubble pops ...biggest exports getting smashed ....back to the 80's soon enough
will be looking to transver more funds into AUD soon enough

[ynot]

The .86 neckline target is getting closer. What do you guys think the odds are of the Kiwi breaking this level ?

[JBmurc]

Very likely .. IMHO parity was pure pipe dream......and when you at a long term chart 1998-2016 there is clearly a head and shoulders pattern developed last few years ....so BEARISH outlook over the long term
high 70's bottom out 2017-18 my pick

Glad to have brought more AUD recently

[Entrep]

Very likely .. IMHO parity was pure pipe dream......and when you at a long term chart 1998-2016 there is clearly a head and shoulders pattern developed last few years ....so BEARISH outlook over the long term
high 70's bottom out 2017-18 my pick

Glad to have brought more AUD recently

Yup, been holding my AUD since I started this thread back in December 2013... LOL

[Hoop]

I try not take too much notice with TA forward projections ...but if FAers can do it with forward PE's and earnings..then so can TAers..
Usually both FA and TA forward analysis come to grief at some point and the blame falls on the so-called "unexpected" events whereas the blame should really fall on the analyst doing the unreliable things with their disciplines... whether its TA or FA it doesn't matter..

But I can't resist myself.....
Why?....
1..The 25 year chart shows the NZ$ v A$ as in a cyclical currency relationship
2..The cyclical oscillation is near symmetrical...implying that if NZ/Ausralia relationships remain similar as they have done in the past, the future prediction should be very reliable.
3..The classic Head and Shoulder pattern is the most reliable of all chart patterns.
4...Past Head and shoulder patterns have worked and their predicted target points were accurate enough..

As I'm a believer that a high currency shows a better economy.. then that assumption + the chart below suggests the NZ economic future performance will be below that of it's Aussi Neighbor for the next 4 years...So the greener pastures will once again be over the ditch...

As an NZ investor the chart implies that my Equity portfolio should contain a decreasing NZ exposure..Any Multi Currency Trading account money could be better off in Aussi cash rather than NZ cash...


http://i458.photobucket.com/albums/qq306/Hoop_1/NZ%20A%2014032016.png (http://s458.photobucket.com/user/Hoop_1/media/NZ%20A%2014032016.png.html)

[JBmurc]

Great work Hoop.... will also be putting more funds into AUD ...2020 be a great time to bring the funds back to NZD....if all goes to plan with my ASX picks I'm hoping it will be a good amount

[winner69]

Hoops - interesting you should do some predicting, esp taking a currency chart and extrapolating a possible outcome to foretell how 2 economies are going to do

Lets see how this turns out eh - "As I'm a believer that a high currency shows a better economy.. then that assumption + the chart below suggests the NZ economic future performance will be below that of it's Aussi Neighbor for the next 4 years...So the greener pastures will once again be over the ditch..."

Interesting TA v FA

I think NZ will still have stronger growth than Aust - ie NZ$ will recover ........but if the Chinese start building big time again and want more iron than a tumble in the nz$ v au$ is likely (your head and shoulders pattern playing out)

[Valuegrowth]

I agree with Hoop. NZD not only could drop against AUD but also against majority of currencies which include USD. Despite some depreciation still AUD and NZD are two of the most overvalued currencies in the world.

In the short run there could be some support for both AUD and NZD while having volatility. However, as we haven’t seen strong phase Of USD yet we can expect further fall in currencies such as AUD and NZD most probably during second half of 2016 and in 2017/18. I expect bigger fall in both AUD and NZD in 2017/18.

In addition, I believe just like Euro we should see single currency in New Zealand and Australia as well. This will eliminate not only fluctuation risks and exchange costs but also will lead to closer co-operation between two countries.

Some of the benefits of the single currency are:



Greater security and more opportunities for businesses and markets
Improved economic stability and growth


My ideas are not a recommendation to either buy or sell any security, commodity or currency. Please do your own research prior to making any investment decisions.

[smpl]

I always laugh when I see the pair quoted this way, who are all these people?

[Valuegrowth]

NZD remains vulnerable to a fall in risk appetite.

http://www.econotimes.com/FxWirePro-AUD-NZD-hits-key-resistance-at-11298-intraday-bias-remains-bullish-183333


http://www.radionz.co.nz/news/business/293148/new-zealand-dollar-to-slide-in-2016-analysts

New Zealand dollar to slide in 2016 - analysts

My ideas are not a recommendation to either buy or sell any security, commodity or currency. Please do your own research prior to making any investment decisions.

[winner69]

NZD looking good

Aussie inflation surprisly down so punters expect a rate cut over the Tasman

Wheeler being brave and not bowing to the wishes of the bank commentators might mean no more OCR cuts and softening the boom bust cycle he has created

So likely stronger NZD v AUD next few months

[stoploss]

NZD looking good

Aussie inflation surprisly down so punters expect a rate cut over the Tasman

Wheeler being brave and not bowing to the wishes of the bank commentators might mean no more OCR cuts and softening the boom bust cycle he has created

So likely stronger NZD v AUD next few months

RBA has cut so going to keep the pressure on the cross and RBNZ .....

http://www.investordaily.com.au/markets/39298-rba-cash-rate-decision7?utm_source=ID&utm_campaign=ID_Newsflash&utm_medium=email

[winner69]

RBA has cut so going to keep the pressure on the cross and RBNZ .....

http://www.investordaily.com.au/markets/39298-rba-cash-rate-decision7?utm_source=ID&utm_campaign=ID_Newsflash&utm_medium=email

Good eh

Could get to 0.93 tomorrow

Wheeler would be foolish to bow to bankers pressure - economy doing very well - meddle with interest rates and we end up with a huge bust in 2017/2018

[Hoop]

Good eh

Could get to 0.93 tomorrow

Wheeler would be foolish to bow to bankers pressure - economy doing very well - meddle with interest rates and we end up with a huge bust in 2017/2018

Which will no doubt happen if you believe (as do the Austrians) that Central Banks are the primary drivers of business cycles ...

[winner69]

Good eh

Could get to 0.93 tomorrow

Wheeler would be foolish to bow to bankers pressure - economy doing very well - meddle with interest rates and we end up with a huge bust in 2017/2018

Well well - hit 0.94 - not a surprise

Those bank economists/commentators still forecasting low 80's - hmm

[winner69]

Over 95 cents now - not surprising seeing economy on fire

Parity - not likely but heck it could remain at these sort of levels for a while

[King1212]

good time to invest in oz shares?

[winner69]

The reasonable but not spectacular GDF number this morning gave the nzd a decent boost

Going well isn't it

[Hoop]

Well well - hit 0.94 - not a surprise

Those bank economists/commentators still forecasting low 80's - hmm
One month later and it is 0.9625.
Hamish & Fred Dagg (from the NZR thread)...An example of how not to put all your total faith/money with Economists/Commentators/Financiers and Brokers forward projections.
A real worry is the interest rate curve is inverting again..(a perceived recessionary view by markets if inversion not corrected)

The 5yr swaps is OCR is 2.25 3M Bills 2.42 5Yr Swaps 2.29% 10 yr swaps 2.61
From RBNZ website the next review is 11th August (over 2 months between periods this time) which is a still long way away..

Hmmmm..question.. ..Mr Wheeler is there going to be a Official Cash Rate drop happening before the scheduled 11th August announcement date??

[winner69]

OMG, just heard Cam Bagrie of ANZ on the radio that the nzd and aud will equal sometime in the next year

Simple really - the cross rate driven by relative economic performance across the 2 countries. NZ continuing to do well and AU facing headwinds, now more apparent with the political uncertainity

Good to see my mate Cam realising this - wonder if the banks will stick to the low to mid 80's forecasts they seem to have at present.

Message is clear - the NZD is not overvalued

[Hoop]

Message is clear - the NZD is not overvalued

My view is a long term strong currency is a sign of a healthy, stable environment and a growing economy...gotta go now.. need to find a piece of wood to touch.:)

[winner69]

Message is clear - the NZD is not overvalued

My view is a long term strong currency is a sign of a healthy, stable environment and a growing economy...gotta go now.. need to find a piece of wood to touch.:)

Right on mate - a strong dollar we should be proud off

You have to wonder why 'gurus' love the purchasing power parity approach

[Hoop]

Right on mate - a strong dollar we should be proud off

You have to wonder why 'gurus' love the purchasing power parity approach

...the purchasing power parity approach...

???..do you mean the sudden attraction to implement a different form of easing such as "helicopter money"...like giving everyone a tax refund /tax break incentive or depositing $1000 dollars into everyone's bank account, so to kickstart the economy (prevent deflation) using "from the ground up" method by increasing purchasing power of the people?................towards parity?... to match the well used conventional "trickle down" methods such as lowering interest rates, increasing liquidity and other forms of monetary easing ??

Yeah..its getting a bit hard (especially in the EU) to kick start growth by lowering interest rates (easing liquidity) when the rates are already in the negatives. It seems monetary easing in these sorts of financial environments loses some of it's potency..Apparently the negative rates are creating other problems Insurance Companies and the Banks are finding it tough going.

....so...I guess looking at other more unconventional options of kicking growth is understandable

I see Finland (http://www.independent.co.uk/news/world/europe/finland-plans-to-give-every-citizen-800-euros-a-month-and-scrap-benefits-a6762226.html)were thinking about this last year... swapping from traditional benefits distribution to helicopter money..The saving in administration costs would be so huge that they could afford to give money (800 Euros a month) to every individual that are of Finish citizenship..

I'm not sure about the effects this has on a Country's currency

[winner69]

Goodness gracious me - Westpac bank guys woken up -

We see scope for further gains to the 0.98-1.00 area during the month ahead. Geopolitical uncertainty should affect the AUD more than the NZD, and the market is losing confidence in an August cut from the RBNZ.


Still trying to work out why the variance to their 'fair value model' is so high - th model says it shoul be 86 cents

[Hoop]

I see the recent interest rate drop didn't see the Aussi$ tumble longer term ..it seems to have strengthened a bit..
Maybe the people are now seeing that lower interest rates may help the economy become stronger + equity markets and equalising with other currency with similar interest drops... thereby not always mean "a drop in interest rate = a drop in currency" in the longer term....The currency should reflect the health of that Nation

Let's see what happens to the NZ$ next week...Mr Wheeler has left things very late..the market is inverting and the 5yr swaps are at 2.08%..

Crikey!!! the market is telling us the OCR would not look out of place at 1.75%...The present 2.25% level looks very out of place now.

..It seems the RBNZ has it's tits in a tangle over John key's criticism and the media leak, they have gone "dark"..Not showing their intentions to give markets some sense of certainty and time to slowly correct is foolish in my opinion..Where is the Janet approach?...

Next week...The market is expecting the OCR to be cut by 0.25% to 2.0%...It wouldn't surprise me to see a 1.75% bombshell hit the markets...but I'm a pleb and my opinion is useless and worth nothing..

[kiora]

I see the recent interest rate drop didn't see the Aussi$ tumble longer term ..it seems to have strengthened a bit..
Maybe the people are now seeing that lower interest rates may help the economy become stronger + equity markets and equalising with other currency with similar interest drops... thereby not always mean "a drop in interest rate = a drop in currency" in the longer term....The currency should reflect the health of that Nation

Let's see what happens to the NZ$ next week...Mr Wheeler has left things very late..the market is inverting and the 5yr swaps are at 2.08%..

Crikey!!! the market is telling us the OCR would not look out of place at 1.75%...The present 2.25% level looks very out of place now.

..It seems the RBNZ has it's tits in a tangle over John key's criticism and the media leak, they have gone "dark"..Not showing their intentions to give markets some sense of certainty and time to slowly correct is foolish in my opinion..Where is the Janet approach?...

Next week...The market is expecting the OCR to be cut by 0.25% to 2.0%...It wouldn't surprise me to see a 1.75% bombshell hit the markets...but I'm a pleb and my opinion is useless and worth nothing..

0.5% cut would be nice for our exporters,even necessary ;)

[winner69]

0.5% cut would be nice for our exporters,even necessary ;)

......assuming the NZD drops - lately doesn't seem to do what Wheeler thinks it should does it?

(And yes Wheeler is being sucked in by bank economists to make drastic cuts - ASB even suggesting 1.5%. Cuts only add to current economic boom and creates a mega-boom and what followsa boom?)

[Hoop]

......assuming the NZD drops - lately doesn't seem to do what Wheeler thinks it should does it?

...Cuts only add to current economic boom and creates a mega-boom and what followsa boom?)

A Kaboom?:mellow:..

Kiora...Do not wish for a lower NZ$, it may come true...It may seem nice for an Exporter on paper, but in reality it ain't..

Look at the "recent" times when our dollar was low.. 1984/6 .. 1992/3.. 2001/2.. 2008/9..

2008/9 was mild to the general public in NZ and didn't affect most people too much apart from the retirees...Unfortunately most younger people think the 2008 GFC was the worst recession ever and it didn't affect them so they assume no problems for the future recessions..eh?

...In reality earlier recessions were a lot worse for NZ ..Ask any Oldtimer Tradie what it was like in 1992 and 2001...very ugly times.

When were those periods when our NZ$ were at their lowest value?..,,Yep when NZ had financial/economy problems combined with personal hardship which included exporters..

http://cdn.tradingeconomics.com/charts/new-zealand-currency.png?s=nzdusd&v=201608050810n&d1=19160101&d2=20161231

[kiora]

On balance lower dollar from memory lifted the rural economies though.I still remember the 80's when the rural economy was really sick.Once the Lange govt took over,$ crashed but the rural economy was humming within 2 years.Maybe too simplistic and one part of the economy but things go in cycles and I wonder if/when it will be the time for the rural economy to lift(apart from apples,honey,wine that are doing well).Its certainly been a long stretch in the doldrums but few things last forever.

[JBmurc]

Kiora...Do not wish for a lower NZ$, it may come true...It may seem nice for an Exporter on paper, but in reality it ain't..

Really well the factory we supply with our export product it does ,, the NZD/AUD has a huge affect on my take home pay as I'm paid on a percent of the gross sale price less fixed costs...the difference is huge ...a 80c to 95c is a basic drop of 20-25% of my income...and I'm sure many others would be affected likewise

[Hoop]

Kiora...Do not wish for a lower NZ$, it may come true...It may seem nice for an Exporter on paper, but in reality it ain't..

Really well the factory we supply with our export product it does ,, the NZD/AUD has a huge affect on my take home pay as I'm paid on a percent of the gross sale price less fixed costs...the difference is huge ...a 80c to 95c is a basic drop of 20-25% of my income...and I'm sure many others would be affected likewise

A drop in currency value is a Short Term Fix only JB ..Theory says over the long term a persistent low currency ...is not good to most of us..It makes for a drop in competitiveness, produce becomes less attractive to buyers (quality/price) unemployment increases..This could result in a downward currency value spiral.. Overall I don't think that scenario would be great for your exporting business or your pay packet ...eh?


Anyway..what percent of the working population,as yourself, get a pay rise every time the NZ dollar drops...1 % , 2%, ..?...A drop in currency is a "swings and roundabouts" "Rob Peter to pay Paul" type scenarios ..The counter-argument with a drop in currency is how many lose their jobs at the importing end?... .

I reckon over time (the long term) a high currency is far far better for everyone than a low currency...So why is it that everyone is brainwashed into thinking a Country should have to keep dropping their currency to perform.. The logic is wrong.. its short sighted thinking....and when Central Banks start acting this way it creates destructive currency wars.

Still Don't believe me... OK..
I googled this website economics made simple (http://www.economicshelp.org/blog/2899/economics/unemployment-and-exchange-rate/)..

quote..."
Long Term Factors

In the long term, a country may boost productivity and competitiveness, this would create jobs and increase demand for exports. This would also help reduce unemployment and strengthen the exchange rate.
High unemployment may be caused by a lack of competitiveness which reduces the value of the exchange rate over time.

[winner69]

This is a good article. A bit of Rodney touting for business but a good read

Why the forex market is smarter than the Reserve Bank

http://www.sra.co.nz/pdf/SmartForexJul16.pdf

Governor Wheeler has spent almost the last two years trying to talk the exchange rate down. His comments and actions may have played a part in it falling for a period. However, since September last year the exchange rate has appreciated 12% contrary to the governor's continued calls for it to fall more in response to the falls in export prices and especially dairy farm incomes; despite him backing up his calls with OCR cuts. History is full of examples of the forex market, for all its shortcomings, being smarter than Reserve Bank governors and I don't expect things to be different this time around as discussed in this Raving. In our monthly forex reports I have been predicting upside in the exchange rate, with the upside being aided rather than hindered by the five OCR cuts the governor has delivered.

[JBmurc]

A drop in currency value is a Short Term Fix only JB ..Over the long term a persistant low currency reduces export quantities over time due to less competiveness and production...less work comes in for exporters and you are eventually made redundant..
Anyway..what percent of the working population get a pay rise every time the NZ dollar drops...1 % , 2%, ..?...Often when the NZ drops severely enough as in your example(95c to 80c) you and many others your profession would get a great pay rise but I would reckon more numbers in other professions would lose their jobs entirely and the unemployment rate rises...At 94c it cant be all that bad JB it sounds like you still have a job :D.

I reckon over time (the long term) a high currency is far far better for everyone than a low currency...So why is it that everyone is brainwashed into thinking a Country should have a drop in currency to perform better and make everyones assets suddenly of less value?? The logic is wrong.. its short sighted thinking.

Still Don't beleive me... OK..
I googled this website economics made simple (http://www.economicshelp.org/blog/2899/economics/unemployment-and-exchange-rate/)..

quote..."
Long Term Factors In the long term, a country may boost productivity and competitiveness, this would create jobs and increase demand for exports. This would also help reduce unemployment and strengthen the exchange rate.
High unemployment may be caused by a lack of competitiveness which reduces the value of the exchange rate over time.

A high NZD is great for NZ consumers that's for sure and the retail/importing businesses that benefit ...and foreign borrowers ....a long term high NZD only enlarges these debts >> and directs more employment into these import /consumer lead industries

We of course can paper over the issues of low paying retail/tourism/consumer jobs by keeping the door open for me consumers to come and live here ...


Fact-
New Zealand was such an efficient farming nation,
and the demand from Britain for food so great, that for
decades New Zealand – Britain’s farm in the South
Pacific, as it was often called – enjoyed one of the
highest standards of living in the world.....and why was this because we had huge export demand and high paying export jobs and low debt in housing ....the present NZ is going the other direction ...debt fueled property bubbles , huge increase in jobs for





--Just look at many of the Export focused nations- Japan,China in their Currency wars, also known as competitive devaluations, is a condition in international affairs where countries seek to gain a trade advantage over other countries by causing the exchange rate of their currency to fall in relation to other currencies....

[Hoop]

A high NZD is great for NZ consumers that's for sure and the retail/importing businesses that benefit ...and foreign borrowers ....a long term high NZD only enlarges these debts >> and directs more employment into these import /consumer lead industries

We of course can paper over the issues of low paying retail/tourism/consumer jobs by keeping the door open for me consumers to come and live here ...


Fact-
New Zealand was such an efficient farming nation,
and the demand from Britain for food so great, that for
decades New Zealand – Britain’s farm in the South
Pacific, as it was often called – enjoyed one of the
highest standards of living in the world.....and why was this because we had huge export demand and high paying export jobs and low debt in housing ....the present NZ is going the other direction ...debt fueled property bubbles , huge increase in jobs for





--Just look at many of the Export focused nations- Japan,China in their Currency wars, also known as competitive devaluations, is a condition in international affairs where countries seek to gain a trade advantage over other countries by causing the exchange rate of their currency to fall in relation to other currencies....


JB... Strange quote of fact to support your low currency argument

Fact-
New Zealand was such an efficient farming nation,
and the demand from Britain for food so great, that for
decades New Zealand – Britain’s farm in the South
Pacific, as it was often called – enjoyed one of the
highest standards of living in the world.....and why was this because we had huge export demand and high paying export jobs and low debt in housing ....the present NZ is going the other direction ...debt fueled property bubbles , huge increase in jobs for
Did you know that the NZ pound was a very high valued currency back then it was pegged to the British Pound and then to the US Dollar yep..The NZ currency fell in tandem with our standard of living with the Bretton Woods event and from the 1960's onwards our currency slowly devalued with the falling peg... The data I found by 1967 the new much lower decimal currency NZ$1 was = US$1.47 now its US$0.71..Unfortunately the currency figures for NZ as with all NZ business data is very hard to find..but I do know this from 1960 onwards the regulated NZ currency was lowering in value (but still far too high) and so was our standard of living together with a persistent faltering economy. Britain no longer guaranteed to buy all our produce exposed NZ as very vulnerable country to market forces (competitiveness) and as our own Market competitiveness was very low it reflected in our lowering currency..Regulated currency being propped up was far too overvalued for a Country heading toward a banana republic status

Did you know that Britain bought our Butter back in 1947 for 1s 6p that is equilivant to NZ$12.09 today but that's not the real price as the British was similar priced currency to NZ, so it was worth British 12 pound 1s that's equivalent to today's exchange rate of (0.54) NZ$22.39/lb of butter and that's wholesale rates..(see NZ archive reference)

Now that why NZ was a wealthy country and we had a great standard of living back then and naturally little debt...so lets continue to screw Mother England....eh. (see NZ Archives)

But things in NZ back then when I was a kid was highly expensive shoes,cars,machinery,TV radios etc...I grew up on a dairy farm...milking 80 cows a day was enough for a very good living and during the daytime there was ample leisure time...all that farmer lifestyle started to erode away by the mid 1960's...actually had to get off your arse and break more land in and milk more cows...The regulated drops in NZ currency was usually too late and had no lasting effect..by 1970 my Father and Mother were "going through the Mill" (hard times)..Honestly no country wanted to buy our dairy products packed in unsealed cardboard boxes or wrapped up in hessian..When the unsold butter became a mountain of rancid muck they would ship it out into mid-ocean and dump it overboard.. I still remember the dressed lamb carcasses in Hessian on the freight train to be exported overseas..they were fly blown...The old NZ attitude was back then was "stop whinging if you didn't like it go somewhere else" The inability to listen and learn about change took NZ culture decades to rectify..
The lag on my previous chart shows this inability to compete timeline (and instead relied on Govt subsidies)...Which reminds me how crazy the Subsidy on milk was back then..We lived on a dairy farm but bought bottled milk.

NZ archives (http://archives.govt.nz/gallery/v/Walter+Nash+Exhibition/Commonwealth+Politics+and+Economy/Great+Britain/Economy/The+People/p_0952.jpg.html?g2_imageViewsIndex=1)

[JBmurc]

Yes I thought it might well have been ...but do you really think NZ would be a better country for all with such a strong NZD say parity against USD and stronger than the AUD ? .. If it does I hope I have moved into a different sector as If I don't most likely be earning around half what I did 10yrs ago...maybe importing aussie/yank seafood to feed kiwis

[Hoop]

I see the recent interest rate drop didn't see the Aussi$ tumble longer term ..it seems to have strengthened a bit..
Maybe the people are now seeing that lower interest rates may help the economy become stronger + equity markets and equalising with other currency with similar interest drops... thereby not always mean "a drop in interest rate = a drop in currency" in the longer term....The currency should reflect the health of that Nation

Let's see what happens to the NZ$ next week...Mr Wheeler has left things very late..the market is inverting and the 5yr swaps are at 2.08%..

Crikey!!! the market is telling us the OCR would not look out of place at 1.75%...The present 2.25% level looks very out of place now.

..It seems the RBNZ has it's tits in a tangle over John key's criticism and the media leak, they have gone "dark"..Not showing their intentions to give markets some sense of certainty and time to slowly correct is foolish in my opinion..Where is the Janet approach?...

Next week...The market is expecting the OCR to be cut by 0.25% to 2.0%...It wouldn't surprise me to see a 1.75% bombshell hit the markets...but I'm a pleb and my opinion is useless and worth nothing..


This is why the NZ$ currency went up with the Reserve Bank dropping the OCR from 2.25% to 2.0%
Winner...you will be a Wheeler fan now..eh?http://www.sharetrader.co.nz/images/smilies/wink2.gif
JB...you won't be

[winner69]

This is a good article. A bit of Rodney touting for business but a good read

Why the forex market is smarter than the Reserve Bank

http://www.sra.co.nz/pdf/SmartForexJul16.pdf

Governor Wheeler has spent almost the last two years trying to talk the exNchange rate down. His comments and actions may have played a part in it falling for a period. However, since September last year the exchange rate has appreciated 12% contrary to the governor's continued calls for it to fall more in response to the falls in export prices and especially dairy farm incomes; despite him backing up his calls with OCR cuts. History is full of examples of the forex market, for all its shortcomings, being smarter than Reserve Bank governors and I don't expect things to be different this time around as discussed in this Raving. In our monthly forex reports I have been predicting upside in the exchange rate, with the upside being aided rather than hindered by the five OCR cuts the governor has delivered.

Did anybody read this?

[winner69]

This is why the NZ$ currency went up with the Reserve Bank dropping the OCR from 2.25% to 2.0%
Winner...you will be a Wheeler fan now..eh?http://www.sharetrader.co.nz/images/smilies/wink2.gif
JB...you won't be

No Hoop - he shouldn't be cutting. Only creating a bigger bust one day

[peat]

Did anybody read this?
yes I always read Rodney's free stuff. He sure wont get a job back in the RBNZ anytime soon. heheh.

Regarding this thread topic, I tend to have a long term faith that the Aussie $ will overall be more robust than our one, simply due to the overall size and breadth of their economy though they did become (like us) too dependent on a particular sector. Not a trading strategy though.
Technically after a massive decline I see a bullish gartley on the AUD/NZD cross rate at the weekly view.

8215

[Hoop]

No Hoop - he shouldn't be cutting. Only creating a bigger bust one day
The market credit is automatically tightening to the point of inverting the yield curve...The Central Banks around the world have probably caused this problem starting a few years back but that's another story..

Today we have in NZ a risk free instrument offering a higher rate than a more risky instrument..and you Winner want it see this situation being more exaggerated..

From what I've been taught..this situation diverts credit away from the longer time period end of maturities e.g business loans and mortgages etc, creating a credit squeeze...and an economic slowdown... some say enough to cause recessions...

Some might say this is what's needed to halt the property market boom and the probably the Equity market boom as well...but creating a credit squeeze when a market is perilously overvalued is like using a sledgehammer to crack a nut...it can cause a crash...This is the last thing that anybody wants to see happen..Joe and Jane Public may like to see property prices fall (for the moral good), but that would create a period of deflation which is the last thing the NZ economy wants or can afford....Would it solve Mr Wheelers frustration over a high dollar..maybe, maybe not...it depends on the flight to quality

With many gauges pointing in the Red Zone and a Government breathing down your neck over the property bubble .. it's may not a good time to be a Reserve Bank Governor..methinks:(

[JBmurc]

Asked then for a clear signal: will you do whatever it takes to stop inflation expectations dropping, including, if it was required, consider dropping interest rates to zero?

His answer could not have been more empty. "Let's see how the future unfolds."
--Graeme Wheeler

[winner69]

Jb - you must hate it every time Wheeler wantsvto say something

Xrate breaks thru 95 ...yippee


The New Zealand dollar rose ahead of a speech by Reserve Bank governor Graeme Wheeler which may hint at the timing of further easing, with at least one further cut expected this year.
http://www.sharechat.co.nz/article/09f95d35/nz-dollar-gains-ahead-of-wheeler-speech-which-may-hint-at-rate-cut-prospects.html


Traders have him sussed

[Hoop]

Jb - you must hate it every time Wheeler wantsvto say something

......Traders have him sussed

With the NZ$ being the 10th most traded currency at approx $105billion turnover a day....Traders are probably saying "Who's Wheeler?" :D

[Daytr]

I see Citibank is calling for parity, I imagine the RBNZ will step in if we start getting close.
They are slowly starting to run out of ammunition tho on the rates side of things and with housing already out of control they will be wary of lowering rates too much. With so much money pouring in from overseas its going to be hard to combat and its not all about yield, its also being fuelled by immigration.

[winner69]

I see Citibank is calling for parity, I imagine the RBNZ will step in if we start getting close.
They are slowly starting to run out of ammunition tho on the rates side of things and with housing already out of control they will be wary of lowering rates too much. With so much money pouring in from overseas its going to be hard to combat and its not all about yield, its also being fuelled by immigration.

Parity - that be good

Says the country is generally doing pretty well

[Hoop]

Parity - that be good

Says the country is generally doing pretty well

Agree................and performing better than Australia for a wee while now so NZ should be closing the gap and if NZ keeps performing better than OZ then parity should be reached and overtaken.....Good too is, in global money terms NZ is also closing the wage gap.

[Valuegrowth]

One by one, there are lot of theories are coming to the market.

http://www.businessinsider.com.au/cba-cows-could-herd-the-new-zealand-dollar-towards-parity-with-the-aussie-2016-8

CBA: Cows could herd the New Zealand dollar towards parity with the Aussie

I expect beginning of major weakness in these two currencies against USD sooner than later. Despite some slow depreciation against USD still they have some strength.

[JBmurc]

Average Australian household income is nearly 20k (20%) AUD higher than here in NZ... thinking parity mean NZD'er are doing better doesn't stack up ....yes we are chasing the aussies Debt to household incomes ....

[winner69]

Reading comments people make on Confidence Surveys etc i never know whether to cry or laugh when several think it is their entitlement to have a weak / low nzd and feel hard done by when it goes against them

[winner69]

Wonder what our mate Wheeler is thinking now?

He needs to stop worrying about the NZD and earn his keep on worrying about other things

Then again be good if he did bit more jaw boning

[peat]

Wonder what our mate Wheeler is thinking now?



Then again be good if he did bit more jaw boning

or he could just sell it by the yard.

[Daytr]

Well depends what you mean by performing well.
Don't get confused by a world chasing yield with performance.
We do have political stability and that is certainly better than the rotational PM job in Aussie.
However parity for the cross is not a good thing, although it does help with our imports from across the ditch including building materials to support the housing boom.
The economy is being driven by immigration, so depends on your view there is a substantial cost to that.
Government spending should be rising by 5-10 billion every year to cater for the new infrastructure, social spending etc for the increase in population.
However we aren't seeing that as they can't fund it, so its not sustainable and they are creating a government budget crisis one day that will require catch up. Where I live we have massive infrastructure issues and they are so far behind its already creating problems in regards sewerage, roads and town planning. Anyway enough of the political rant.
I have been building a large position in the cross shorting the Kiwi. Perhaps we will see it go lower, however I get the feeling the RBNZ may have already been in the market. There was a massive move the other night pushing it back toward 1.04, obviously it didn't hold.
If it moves lower I will add to the position as I can't see this level being sustained.


Parity - that be good

Says the country is generally doing pretty well

[winner69]

Daytr - You having a great time with your punts on the VIX etc. well done

Can't really go wrong with your punt on the AUD/NZD either can you - if nothing else the cycle is in your favour. No doubt we will see 75/1.33 (whichever way you look at it) again some time in the future. How much you make probably depends on how patient you are.

[Valuegrowth]

Thank you Daytr for your good analysis. I already became a big bear for both NZD and AUD.
Well depends what you mean by performing well.
Don't get confused by a world chasing yield with performance.
We do have political stability and that is certainly better than the rotational PM job in Aussie.
However parity for the cross is not a good thing, although it does help with our imports from across the ditch including building materials to support the housing boom.
The economy is being driven by immigration, so depends on your view there is a substantial cost to that.
Government spending should be rising by 5-10 billion every year to cater for the new infrastructure, social spending etc for the increase in population.
However we aren't seeing that as they can't fund it, so its not sustainable and they are creating a government budget crisis one day that will require catch up. Where I live we have massive infrastructure issues and they are so far behind its already creating problems in regards sewerage, roads and town planning. Anyway enough of the political rant.
I have been building a large position in the cross shorting the Kiwi. Perhaps we will see it go lower, however I get the feeling the RBNZ may have already been in the market. There was a massive move the other night pushing it back toward 1.04, obviously it didn't hold.
If it moves lower I will add to the position as I can't see this level being sustained.

[Edwood]

How are you trading VIX Daytr (i.e., what instrument code are you using?)
Agree with you on AUDNZD, have an average price around .957 - MACD divergence points to a kick higher

[Daytr]

Through a CFD via CMC markets.
Should have hung on. Mind you it dipped considerably for 24 hours before charging into the 18s!
Can't complain, I made very good money.
Now hopefully there will be a big mover in the Kiwi cross!

[winner69]

Goldman Sachs analyst is one of the few sensible analysts around - he says NZ don't need any more rate cuts

http://www.bloomberg.com/news/articles/2016-09-19/sizzling-kiwi-economy-sees-goldman-go-out-on-a-limb-over-rates

[Hoop]

Goldman Sachs analyst is one of the few sensible analysts around - he says NZ don't need any more rate cuts.......

I've thinking the same too..at the moment....my my.. how my thinking has changed this last month... going from should've been a rate drop to 1.75% .. to now, the 2% should not be lowered..

I've been watching the NZ interest rate market movements for some time now....they took an "unhealthy" dive 2 months back, when the market created a partially inverted yield curve. I mentioned "unhealthy" because the Inverted yield curve is one of my "ducks" .. when many ducks line up in a row a recession usually begins..While the market was diving the NZRB lowered the rates from 2.25 to 2.00% , although the 0.25% fall corrected the yield curve..at that time I questioned whether a rate cut should've been to 1.75% as there was a lot of negative sentiment washing around most markets and the yield curve was looking rather flat......

Since mid August.. I got a gut feeling something suddenly changed, the world financial sentiment entered a "happy space". There was an absence of bad news and for a month the Bulls rallied...

Then last week a sharp world wide equity correction occurred using the same old lame, well worn excuse (FED to raise rates at some near future point in time)..

Positive Sentiment towards NZ has remained and recently intensified..with more "happy" news about the NZ economic growth..sort of brings back memories of the "Rock Star Economy" status..eh?

What didn't respond to the recent world wide Equity correction and a new phase of "worrying sentiment" was the NZ swap rates..They have instead ticked up (see interactive chart) (http://www.interest.co.nz/charts/interest-rates/swap-rates)

I wonder if Goldman Sachs are watching this area..

[Mush]

Goldman Sachs analyst is one of the few sensible analysts around - he says NZ don't need any more rate cuts

http://www.bloomberg.com/news/articles/2016-09-19/sizzling-kiwi-economy-sees-goldman-go-out-on-a-limb-over-rates

I've been debating this with a few colleagues of late. We all know the guvna is playing currency wars for the exporters, inflation is a lost cause as there's not much of that going around anywhere at the moment.
First glance it looks like cutting below the 3% OCR level has caused the NZD to rally (as seen in below graph)

8323

However that poses the question, where would the NZD be now if they hadn't have cut further to 2%?

Wheels is in a tough position, reluctantly cutting to keep the currency under control somewhat. Only positive is that the banks are not fully passing on the cut to borrowers/savers so it isn't fueling the housing fire as much.

[Edwood]

Some nice moves the last few days Daytr, big morning star formed on the weekly :)

[Valuegrowth]

As I said before still NZD has some support. After rates cut instead of going down, NZD went up. House prices also went up and up. Sooner we don't see some sort of adjustment to the NZD, there could be some hard landing at some point. We should see real picture from 2018/19 onwards. By that time we should be able to get clear idea about FED and their policies as well.

[Daytr]

Yep, its been a good week. AUD/NZD well in the money and actually halved my position. Will top up again if we fall back.
Also went short JPY vs USD close to 100 & gold long around $1311. Been some very good swings which is a great trading environment.
RBNZ fighting a losing battle with interest rates and its dangerous as NZ has an incredibly inflated property market.
Both the ccy & property is being impacted by inflows caused by immigration.
The RBNZ can't and shouldn't fight government policy. If the government wants strong immigration, then one of the consequences is a strong dollar.

[Edwood]

Nice work! Happy to be long AUD as a core position and add, plenty of blue sky above. Assuming US raise this year and we get an OCR cut we'll be off to the races! :)
A Vancouver-style property tax would be a great idea - can't see it happening though, John Key isn't showing much spine on what is becoming a problem

ATTACH=CONFIG]8326[/ATTACH]

[Daytr]

Yeah that's my same thought with the Yen. I can see that going back toward 120 to the USD.
I'd like to see the AUD/NZD strengthen again back toward 1.02. But it seems to like 1.05+ at the moment.

[Edwood]

AUDNZD not looking like coming back yet unfortunately Daytr, might hit some resistance around the 1.072 area - good spot on the Yen, thanks, that has potential
Also potential for NZDUSD to be back around the 0.66 area soon-ish

[winner69]

NZD Hanging in around Aoo.96

Still might see parity ...maybe

[Hoop]

NZD Hanging in around Aoo.96

Still might see parity ...maybe

Yeah....I'm noticing the macro's are looking healthier e.g commodity prices are ticking back up...wool oil dairy metals (iron ore, copper etc)..great news for the big commodity exporting nations like Aussie and Canada (NZ too)..
Parity depends on who would benefit better going forward from here, NZ or OZ? A tough question to answer..both will do well but purely from the macro viewpoint my gut feel favours OZ

[peat]

There is a large bullish gartley on the AUD/NZD cross, but its on the monthly timeframe so could take a while to eventuate, or of course it could fail ;+)

[Glendoonie]

POE 1.03101
TP 1.05016
Perhaps a wee bit premature ...

[Glendoonie]

POE 1.03101
TP 1.05016
Perhaps a wee bit premature ...

A revision to the POE, but there's still a long way to go.

POE 1.03691
TP 1.05016

[karlos68]

About to plummet


8587

[peat]

I believe the appropriate statement on the forum these days is 'nicely positioned'

:)

[peat]

bought more AUD/NZD at 1.0481 ....... target is 1.1 so thats 90 for you people who quote the other way round.
8616

[winner69]

bought more AUD/NZD at 1.0481 ....... target is 1.1 so thats 90 for you people who quote the other way round.
8616


I still reckon the pattern of short term spikes and tumbles to remain in place. surprisingly (for some) is that the NZD hasn't fallen v AUD in response to Australian export prices improving relative to NZ prices in recent months.

I still reckon NZ fundamentals will perform stronger than Australian fundamentals this year and so see NZD/AUD remaining pretty high this year (maybe longer) .......and one of those spikes could even take it to parity (thats 1.0 who quote te other way round)

Depending on your timeframe peat you might get lucky on one of those short term tumbles

[winner69]

bought more AUD/NZD at 1.0481 ....... target is 1.1 so thats 90 for you people who quote the other way round.
8616

Peat - that 1.1 is 0.9090 for those quote thewrongway around

Just had to point that out because of your standing in the financial community

[peat]

your post sounds pretty sarcastic winner , what with the conversion of parity and the 'you might get lucky' .... :mellow:
but thank you for the correction.
my time frame is quite large as the bullish gartley is more visible on a weekly time frame,
this pic is from mid August last year
8623

this is current
8624
so its done a double take on the D leg but following that has behaved appropriately. I;m not predicting the relative economic strength of the economy's (this is TA) it just looks like a perfect reversal pattern after those huge moves down from 2011 shown here and then a final capitulation leg.
8625

not sure about my standing, but I persevere. and try to be helpful both here and for work.

[winner69]

No sarcasm peat - just our views are different but then one is from a TA perspective and the other from a fundamental perspective

Standing - just a thought that as you work in the finance industry things should be 'right'

Sorry you took the post the wrong way. Didn't intend to offend. Forgiven?

[peat]

yes yes no problem, and indeed things should be correct, I was definitely careless with that conversion.

[winner69]

NZD on a roll v AUD

Unexpected low CPI in AU and increasing CPI in NZ possibly helping

Might be one of those decent spikes up coming

[winner69]

Jeez, nzd nearly 0.97 aud

That's good

Could even spike higher

[karlos68]

Done its dash?

8636

[karlos68]

Done its dash?

I'm thinking "Yup"

8638

[Toulouse - Luzern]

Today's NZ jobs statistics the factor.

For the present overseas assets are now worth a bit more in NZD

[winner69]

Done its dash?

8636

In free fall today ....down to 95.5

Our unemployment rate up - aussie has huge trade deficit

[peat]

the low of 1.0321 (AUD/Kiwi) was a bit testing but (for me) its good to see the strong rally after that based on two items of news so the long trade holds (I was going to start scaling out below 1.03)

[peat]

In free fall today ....down to 95.5

Our unemployment rate up - aussie has huge trade deficitwasnt it a surplus?

[winner69]

wasnt it a surplus?

Sure was - can't blame spell check for that eh - just so used to associating deficit with trade

I must work lie that software that completes sentences for you.

[karlos68]

Give it time...........(Ignore the market noise)..........I'm thinking down


8658

[peat]

AUD/NZD: Key FX Pair for Next Week

Next week is all about the Australian and New Zealand dollars. We will hopefully find out which of the two currencies is stronger relative to the other one as central banks of both nations have their policy decisions. In addition, we will hear from governors of both the RBA and RBNZ, not to mention there will be some important data from the region. The volatility in the AUD/NZD therefore should go up by a good few notches.




http://snip.ly/k2tlc?utm_content=buffer633ab&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer#http://www.actionforex.com/analysis/daily-forex-technicals/aud%10nzd:-key-fx-pair-for-next-week-20170204280506/ (http://snip.ly/k2tlc?utm_content=buffer633ab&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer#http://www.actionforex.com/analysis/daily-forex-technicals/aud%10nzd:-key-fx-pair-for-next-week-20170204280506/)

[karlos68]

Give it time...........(Ignore the market noise)..........I'm thinking down


8658

That's another "Yup, as expected"

8673

[peat]

a good couple of days on the long Aud/NZD front. we've quickly gone to 1.06

8676

but while its nice to in the black there's still a long way to go to reach my target - as we've seen in the last week a cent or two is just noise, so 1.10 is easy, maybe even 1.14

[winner69]

NZD having one of those spikes down (following the pattern of spikes up and down)

Popular opinion has this as more if a spike down - rather a tumbling NZD into the 80s

[karlos68]

NZD having one of those spikes down (following the pattern of spikes up and down)

Popular opinion has this as more if a spike down - rather a tumbling NZD into the 80s

?????



Here comes the tumble into the 80s fellas



8724

[JBmurc]

?????



Here comes the tumble into the 80s fellas



8724

that would be good

[peat]

a month after my lost post and we almost hit 1.09 AUD/NZD a further 300 pips. 1.0892 to be precise.
I am now slowly beginning to scale out. but I'm in no hurry as it could well just keep going up and up

[smpl]

a month after my lost post and we almost hit 1.09 AUD/NZD a further 300 pips. 1.0892 to be precise.
I am now slowly beginning to scale out. but I'm in no hurry as it could well just keep going up and up

yes back to 1.37 we go... when there was not one post about it on this forum.

[winner69]

yes back to 1.37 we go... when there was not one post about it on this forum.

Those were the days eh .....a beer in Sydney was so expensive

[Hoop]

Re:...yes back to 1.37 we go..

Yep those were the days...everyone driving around in rust buckets visiting garage sales... and... buying too many commodity items at the supermarket resulted in financial pain rather than indigestion pain...