With Hurricane Sandy seemingly passed through the US and coming to an end the clean up operation has already started. With a few million people still without power and the New York Stock Exchange having closed yesterday for the second time in over 27 years the currency markets have been holding their breath before they decide their next move. It doesn’t appear that the cost is too devastating to the US which was the initial fear about its impact on the economy. With this is mind the USD has maintained its range for EURUSD GBPUSD & AUDUSD.
Moving the focus more directly to what is happening to the Australian Dollar at the moment one of the reasons why it has remained quite strong during October is that the various stimulus programmes in both Europe and the US have kept the AUD very strong but also with the potential to cause the RBA to look at cutting interest rates again. Personally I don’t think we’ll have a cut during November as the RBA will take a pause to see if the recent rates cuts have had the desired effect. Indeed, the stimulus has reached USD5 trillion in government bonds and mortgage securities which have appeared to cause the modest global recovery.
The demand felt by overseas investors in Australia has kept the currency strong even with the interest rate cuts earlier this year so until the RBA is more in line with Europe, the US or the UK I don’t think the currency will experience a huge movement purely by interest rate movements.
If you have a currency requirement and would like to save money when buying or selling Australian Dollars please feel free to email directly with how to do so Tom Holian [email protected]