In the Wall Street Journal, “Aussie Dollar Parity Talk Resumes” (gated but link here)
- Traders noted that a statement by the bank announcing its latest interest-rate decision didn’t include a reference, included in the minutes from the Reserve Bank’s June meeting, to uncertainty over the need for further stimulus to offset the impact of slowing mining investment and planned fiscal austerity.
- “This phrase was not included today,” said analysts at HSBC in a note to clients, possibly indicating the Reserve Bank is less anxious about the health of the economy.
Also noted:
- Aussie’s gains have been driven in large part by escalating demand for the country’s bonds,
- important support for the currency is coming from Japanese life-insurance firms offering retail clients high-yielding products underpinned by Aussie bonds
- Better-than-expected Chinese manufacturing data in recent months
- many of the world’s central banks and sovereign-wealth funds to allocate sizable amounts of their investment portfolios to Australia
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There you go. Anyone else get a bit suspicious when it hits the press? Or is the trend just too strong for the AUD?
