Charlie Aitken, stockbroker at Bell Potter (you may recall his fighting words aimed at the Reserve Bank of Australia):

  • Forecast the Australian dollar at US68¢
  • Interest rates below 2%
  • Stockmarket at 6000

He says:

  • "Both the Baltic Dry Index and RBA cash rate are below levels seen at the peak of the GFC"
  • "I now believe it's only a matter of time before the Australian-US dollar cross rate re-correlates to Global Financial levels"
  • "However, against a global backdrop of deflationary forces and competitive currency devaluations, I think there is very real possibility of the cash rate with a "1" handle at some stage over the next 12-18 months
  • "We have now become the latest country to adopt competitive currency devaluation as a monetary tool. Welcome to the global currency wars ... Make no mistake this was a big decision for the Reserve Bank. To suddenly change tack with the cash rate already below global financial crisis levels, and abandon a "period of stability" abandon in favour of a new aggressive easing policy is a monetary event which should not be taken lightly"

More at the Australian Financial Review (gated): Bell Potter's Charlie Aitken tips $A to fall below $US70¢