Canadian and Australian Dollars May Rally Further

Since the beginning of March, both the Canadian and Australian dollars have appreciated significantly against the U.S. dollar. In fact, since March 6, the Canadian dollar appreciated nearly 13 percent against the U.S. dollar and the Australian dollar a stunning 21 percent. A spike in commodity prices triggered by a recovery in global demand helped to boost these currencies and at Trading Economics we think they are likely to strengthen further in the next few months.
Anna Fedec, contact@tradingeconomics.com 5/23/2009 2:44:52 PM

Canada’s Banks Earned More than C$12bn in 2008

The Canadian economy experienced negative GDP growth in the last quarter of 2008. However, is in better shape than many developed countries. For instance, the nation’s 21 banks earned more than C$12bn last year and needed no bailout. More importantly, the government and the central bank have taken measures to improve credit availability and spending. The overnight interest rate was cut to 0.25 per cent and a C$40bn fiscal stimulus package was introduced at the end of January. The trade balance moved into deficit in December and January, but has since rebounded into the positive territory.

 Australian Exports to China Will Rebound in 2009

Higher commodities prices and the rebound of demand for metals in China has been giving a big boost to the exports oriented economy of Australia. And although aussie exports are down from last year highs, they are still above its long-term average. More importantly, a considerable stimulus package and the ongoing monetary policy easing will definitely support the recovery in the next few months. In fact, since last September, 425 basis points have been waived from the benchmark interest rate and unlike in many other countries, the bulk of this reduction has been passed on the households. Moreover, household spending is being boosted by tax bonus payments and government transfers. For example, in March and April consumers received as much as A$950 ($705) in cash handouts and household disposable income was up 10 per cent in real terms.




News

Euro Downward Trend Likely to Continue This Year
In May, the Euro reached its lowest level in 4 years against the US dollar. Yet, although we think that the common currency's downward trend will continue at least for the rest of this year, the worries about its future are far more exaggerated.
Published on 2010-05-24

Euro Falls to Lowest Level Since Lehman Collapse
The euro fell to its lowest level since the collapse of Lehman Brothers Holdings Inc. on concern that the 16-nation currency may be headed for disintegration.
Published on 2010-05-15

US Dollar Looks Overbought
The United States dollar has appreciated significantly against the Euro during the last few months. Rising from 0.66 euros at the beginning of December to almost 0.74 euros in April. But although we believe that the greenback will recover even further in the long term, sooner or later it may start loosing its position.
Published on 2010-02-20

US Dollar May Strengthen Further in 2010
In December, the US Dollar appreciated significantly against the Euro. And although the greenback has started losing its position in January of 2010, we still believe in its long term recovery.
Published on 2010-01-20

Investors More Optimistic About The Dollar and Less About the Euro
The US Dollar has been appreciating since the beginning of December reaching a three month high against the Euro during this week. And although some greenback weakness is possible, the termination of emergency liquidity programs by Federal Reserve is likely to help the dollar going forward.
Published on 2009-12-18

Commodity Linked Currencies Are Recovering With Global Economy
During the last few months, commodity linked currencies, have seen an unprecedented rise in their exchange rate against the dollar. For instance, the Australian Dollar and the Brazilian Real are among those currencies that gained the most. But can those currencies sustain its current levels?
Published on 2009-10-08

US Dollar Looks Oversold
The combination of a weak economy with quantitative easing and a rising appetite for risk has brought the US dollar to its lowest level against the euro since the begging of the year. Moreover, although the recent data suggests that the pace of U.S. contraction may be slowing, the biggest economy in the world is far from a sustainable recovery.
Published on 2009-09-10

Dollar Falls to Lowest Versus Euro in 2009
The dollar dropped to the lowest level this year against the euro as prospects for economic recovery spurred a rally in global stocks, helping to push gold above $1,000 an ounce and oil to more than $71 a barrel.
Published on 2009-09-08

US Dollar May Appreciate Later This Year
In the second half of 2008, investors bought the US dollar as a safe-haven currency. Indeed, the credit crunch was taking over global economy and there very few good alternatives out there. Yet, in the first five months of 2009, like in 2006 and 2007, the greenback depreciated sharply due to spending spree of U.S. government. Looking ahead, we see a potential for gradual Dollar recovery as the US economy starts rebounding and the current account deficit improves.
Published on 2009-07-15

U.S. Dollar is Under Selling Pressure
In the second half of 2008, investors bought the US dollar as a safe-haven currency. The credit crunch was taking over global economy and there very few alternatives out there. However, the first part of 2009 starts looking like 2006 and 2007 when the US dollar depreciated sharply against other currencies.
Published on 2009-06-10

Currencies Devaluation May Trigger a Trade War
One of the outcomes of the global downturn has lead to significant changes in the exchange rates of some currencies. For example, while the British Pound, the Australian Dollar and the South Korean won have weaken dramatically; the Japanese yen and the Swiss franc have reached multi-year highs. And if some countries fight to stop further currency depreciation, others like Switzerland pursue its own devaluation.
Published on 2009-03-17

What's Next for the U.S. dollar, British Pound and Japanese Yen?
The global financial crisis has brought a lot of changes in the FX market. What is behind unprecedented moves in U.S. dollar, British Pound and Japanese Yen and how much longer these currencies can sustain its current levels?
Published on 2009-03-16

The End of Yen Appreciation May Be Close
At the end of January, the Japanese yen reached a series of multi-year highs. Yet, during the last month the Japanese currency retreated by almost 11%. What is behind this unprecedented move? Is this the end of the yen appreciation?
Published on 2009-03-08

How Much Longer Can U.S. Dollar Appreciate?
The U.S. Dollar has been appreciating rapidly after a sudden acceleration of the global financial crisis. What is behind this move and how much longer the currency can sustain its current level?
Published on 2009-03-03

How Much Longer Can Japanese Yen and U.S. Dollar Appreciate?
The Japanese Yen and the U.S. Dollar have appreciating rapidly after a sudden acceleration of the global financial crisis. What is behind those moves and how much longer those currencies can sustain their current levels?
Published on 2009-02-16

Strong Yen May Tear Down The Japanese Economy
At the end of last month, the Japanese yen reached a series of multi-year highs, hitting a 13½-year high against the dollar, a seven-year peak against the euro and a record high against sterling. So, what is behind this unprecedented overvaluation and how much can it influence the Japanese economy?
Published on 2009-02-10

U.S. Dollar is the Winner
At the beginning of the last year we were arguing that the U.S. dollar could lose its position as the most popular reserve currency in favor of the Euro. But in the second quarter of 2008 the dollar suddenly started to rebound and began one of its biggest rallies in years, going from 1.6 to 1.2 dollars per euro in only three months.
Published on 2009-01-13

Euro Rises
The euro rose against the dollar and the yen on speculation the European Central Bank will avoid trimming interest rates as low as its major counterparts.
Published on 2009-01-07

Yen Falls Versus Euro, Dollar
The yen weakened against the euro and the dollar as a record plunge in Japan’s exports last month signaled the world’s second-largest economy was falling deeper into a recession.
Published on 2008-12-22

Ruble Falls to 3-Year Low
The ruble fell to the lowest in almost three years against the dollar as Russia devalued the currency against its dollar-euro basket and tumbling oil prices battered the economy.
Published on 2008-12-22