THe US Dollar index (DXY) is one of the most well known and quoted currency index in the world. The index represent the value of the US dollar against a basket of major currencies and the direction of the index is often a shorten hand on the overall the direction of US Dollar. What Currencies […]

China’s Economy Slowdown The slowdown of China’s economy has been long time coming. The unprecedented level of growth over 2 decades made China the worlds second largest economy. Over the same period it has not lifted millions but hundreds of millions out of poverty and placed China as one of the key pillars of the global economic order. […]

The currency has depreciated significantly since April 2013 when the Australian dollar peaked at 1.10 against the US dollar. The decline in value of the currency matches the decline in price Australia’s key export commodities from Iron Ore, Coal to Copper. Aside from the fall in commodity prices, another major driver of depreciation is the […]

The downside of the recovery in equity market is there are limited opportunities to deploy capital at this level. Frankly we see the market as fully priced. The increase in volatility post UK EU referendum will create opportunities for those that are patience and willing to ride out the whipsaw. In our Australian equity outlook, […]

We see limited value in the equities market and we are keeping our powder dry for the time being. The biggest surprise of 2016 is the strengthening of the Japanese yen against the US dollar. The result of the UK referendum to leave the EU increase risk aversion across a number of asset classes. On the currency […]

The step up in quantitative easing by Bank of Japan led to a severe depreciation of the Japanese Yen. The fall in Yen resulted in the Australian Dollar to Japanese Yen Exchange rate (AUD JPY) reaching 102 in late 2014 which almost equaled the peak just before the GFC. If the run up in the AUD JPY was […]

During the financial crises, FOMC undertook a number of steps in unconventional monetary policy in order to stimulate the US economy and ensure growth does not fall off a cliff. Now with these programs are being paired back, first with the end of Quantitative Easing (QE) programs, followed by implementation of forward guidance on future policy outlook. The recovery […]

The votes are in and UK has decided to leave the EU. While as the final votes were still being announced, the market already started to sell off once it was evident that the lead of the leave camp was unstoppable. The sell off in the major equity indices around the globe declined along with fall in […]

We are bullish on the Australian dollar in the long term. The effects of fall in commodity prices has largely been priced in the dollar today. Going forward, the cushion of the fall in the dollar will support economic growth and ensure unemployment will remain low. Foreign exchange trading is a relative bet on going […]

The New Zealand dollar (NZD) occupies a precarious position in foreign exchange market. It is a free float currency but its small size in the giant FX market means it can be volatile during periods of extremely tight liquidity. Within the wider context it is almost like a penny stock. Price gets whipped around as the big […]

The RBA has been talking down the Australian dollar as a means of boosting the weak domestic economy. It releases a widely regarded monthly chart pack. Some interesting take away from this month data shows couple reasons why the AUD could be bottoming at this level rather than plowing below 0.70c as a significant portion […]