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ya sudah lah: paritas makin dekat … 171010

October 17, 2010

… KEBETULAN BANGET, kok bisa ya, pas gw uda berhasil mengantarkan anak gw berwisuda sarjana dan berjalan-jalan ria di oz n nz, EKH, dolar oz hampir = dolar amrik … kadang-kadang hidup MEMBERI SENDIRI … gw cuma harus SADAR dan MELAKUKAN INVESTASI yang seperlunya GUNA MEMECAHKAN PERSOALAN INFLASI dalam pembiayaan HAL-HAL yang PENTING dalam hidup gw dan keluarga gw 🙂

Dollar dazzles but parity could cost tourist industry
Tim Barlass and Jessica Wright
October 17, 2010

Aussie dollar’s landmark breakthrough is good news for international travellers and shoppers but misery for the local tourism indutry and manufacturers.
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AS THE Australian dollar pushed past the greenback for the first time since it was floated in 1983, Treasurer Wayne Swan yesterday declared it a ”milestone”.

But he also cautioned that parity between the Australia dollar and the US greenback was a double-edged sword.

The dollar’s journey into new territory was but a brief flirtation, hovering momentarily at $US1.0003 before settling just under US99¢ before the close of trade on Wall Street on Friday.

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Australians heading overseas are celebrating how far their currency will stretch, but the agriculture and tourism industries, as well as small businesses, are all watching the dollar’s rise with concern.

The Australian Tourism Export Council said the message was ”parity don’t panic”, saying the strong growth since August was expected to continue until Christmas.

Matthew Hingerty, the council’s managing director, said inbound travel from China remained ”extremely strong” and was now in fourth place after New Zealand, Britain and the US.

”From the inbound point of view it isn’t a disaster in the short term, but in the long term it will impact on the profitability of the industry,” he said.

”What worries me most is that our industry is made up of small businesses – if the dollar stays high and interest rates go up then profit margins will be squeezed while the cost of debt increases.”

The domestic tourism industry in places such as Western Australia and Tasmania was also suffering, he said, with offshore travel experiencing double digit growth as travellers found it cheaper to go abroad.

Jock Laurie, former president of the NSW Farmers’ Association, said parity was making farmers nervous.

He said in some areas high-demand issues were helping but a lower dollar would be beneficial.

”The world market for sheep meat, where there is a shortage, remains very strong even with a high dollar,” he said. ”With beef and wool where there is more competition in the open markets around the world it is very difficult for people in the export industry.”

Mr Swan said the value of the Australian dollar was reflected in the strength of the economy but there were ”swings and roundabouts” in having a high dollar value.

”This milestone reflects the stark difference in the strength of our economy relative to other nations, record prices for our commodities and the effects of diverse and dynamic international currency markets,” he said.

The last time the Australian dollar neared any form of parity with the US was in July 2008, when it hit US98.49¢, shortly before the crash of Lehman Brothers which sparked the global financial crisis.

Senior Westpac international economist Huw McKay believes the dollar will remain high for some time.

”My personal opinion is the next decade will see a structurally stronger Australian dollar than in decades past, so this is a sign of things to come,” he said.

Domestically manufactured goods are less competitively priced to sell abroad, and will have to vie with cheap imports at home.

Australian companies that make their living in American dollars also are suddenly earning less when they convert back to the home currency.

At Hullubullu, a children’s fashion shop in Australia Street, Newtown, staff told American customers that they would accept the US greenback instead of the Aussie dollar.

”One tourist came in a couple of weeks ago and asked if we accept US dollars. Now that we have reached parity we are telling them we are happy to accept them,” said the shop’s owner, Lisa Turner.

Oprah Winfrey’s much lauded eight-day visit to Australia in December with 300 of her US talk show fans may be Australia’s opportunity to show a global audience that it’s worth the money.

 

One-for-one: dollar hits parity

Chris Zappone

October 16, 2010

Dollar hits parity with greenback

Aussie dollar’s landmark breakthrough is good news for international travellers and shoppers but misery for the local tourism indutry and manufacturers.

The Australian dollar has hit parity overnight with the US dollar for the first time since 1982.

The last time the exchange rate was at parity, Malcolm Fraser was prime minister, Ronald Reagan occupied the White House, the Falklands War had just ended, Split Enz’s ”Six months in a leaky boat” was topping the music charts and the Reserve Bank of Australia controlled the value of the Aussie dollar.

The dollar has threatened to breach the parity mark for several weeks amid speculation US authorities will move to deliberately drive the greenback lower in a bid to reignite growth in the faltering American economy.

The Aussie reached as high as $US1.0003 at 23.18 AEDT, before pulling back to stand at 99.14 US cents shortly after midnight and then easing to 98.84 US cents by the end of the week’s trading.


The Aussie’s breakthrough came after US Federal Reserve chairman Ben Bernanke said the central bank was ready to support recovery “if needed”.

Dr Bernanke, speaking at a conferene in Boston, gave his strongest hint to date that the US central bank will step in to help the country’s fledgling economic recovery with more extraordinary measures to prime the economy.

The greenback slumped as the Fed appeared likely to expand its monetary easing moves, pushing up the Australian dollar, which has been supported by the anticipation of higher interest rates.

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The Australian dollar's journey - pre-float to parity.The Australian dollar’s journey – pre-float to parity.

Parity parties

The timing of the mark stymied some local traders’ plans to hold ”Parity Parties,” replete with funny hats, streamers and champagne.

Herston Economics, for instance, was planning to host a parity party at the Ivy’s Pool Club on George Street in Sydney, while Melbourne-based sales trader Michael Clifton-Jones from currency house GO Markets said staff members would probably have some beers to toast the historic moment.

”But I think all Australians in general will be celebrating because it means that everything in the US is going to be cheaper,” Mr Clifton-Jones said.

While largely symbolic, the 1:1 dollar ratio will be welcomed by those planning to holiday in the US or in other countries that tie their currencies to the greenback. Exporters, though, are likely to wince as a rising Aussie dollar makes their goods less competitive overseas. Cheaper imports will also snatch demand from many local suppliers.

The Australian dollar’s ascendancy reflects in part the relatively robust health of the local economy. Australia was one of the few developed countries to dodge a recession during the global financial crisis, with the central bank now fretting about how the economy will cope with a flood of funds from the revived mining boom.

The unemployment rate is also the envy of almost every other nation, running at just over 5 per cent – about half that in the US and much of Europe.

”We should hold our heads up high as such a significant currency event is a very real recognition of our sophisticated economy, and our coming of age on the world stage,” said Herston Economics chief economist Clifford Bennett. ”The Australian dollar achieving parity is an important and befitting milestone in this country’s rise in prominence on the global stage.”

Short-lived?

Still, the initial parity celebration would have been be a short one, as the dollar soon sank back. Some forecasters predict it will go back above parity in coming weeks, rising to as high as $US1.03, before retreating.

One reason for that pull-back is that the Aussie dollar’s surge of the past few months is due for a correction. The currency is the world’s best-performing unit against the greenback over the past three months, rocketing more than 14 per cent, according to Bloomberg data tracking the 17 most-traded currencies.

Another cause for concern is that the radical experiment in financial management now being considered by the US Fed is hardly a vote of confidence in the health of the US economy – in fact, it’s the reverse.

The Fed’s aim of printing money – so-called quantitative easing – is one of the last arrows in the US quiver as authorities struggle to find new ways to generate growth. The expectation is that those extra US dollars will find their way into other markets, sending stocks to five-month highs and gold to record levels approaching $US1400 an ounce in recent days.

A cheaper greenback may make US goods cheaper abroad – the euro is up about 10 per cent and the yen about 8 per cent against the greenback in the past three months – but it has also prompted accusations that the US has declared a ”currency war”.

Whether that battle erupts into a trade war depends on what if any steps other nations take in response to the greenback’s slide, analysts say.

‘Shock absorber’

For now, though, dollar parity gives Australians a chance to reflect on a generation of volatility for our currency.

The Australian dollar was last equal in value to the greenback on July 28, 1982, when the legal tender’s value was set by the Reserve Bank.

The Labor government of prime minister Bob Hawke and treasurer Paul Keating allowed the dollar to float freely against other currencies on 12 December 1982 as part of a major reform package aimed at kick-starting economic growth.

Decades later, politicians and economists continue to bicker over the ownership of the idea to liberate the currency, although few dispute the beneficial effects of the move.

The fluctuating dollar has helped cushion the economy from global economic shocks – rising in value when growth quickens and easing back when demand slows or sinks.

”The government supports a floating currency, which has served our nation well as a shock absorber against global events for more than a quarter of a century,” said Federal Treasurer Wayne Swan. ”But we know that there are swings and roundabouts, and while the dollar has beneficial impacts for consumers through cheaper imports, it also makes life tougher for some sectors of our economy such as manufacturing and tourism.’

‘Pacific Peso’

And the dollar’s movements haven’t been left solely to the hunches – informed or otherwise – of currency traders and speculators.

Then-treasurer Paul Keating’s warning that Australia risked becoming a ”Banana Republic” sent the dollar plummeting in mid-1986, diving from 74 US cents to less than 60 US cents in the space of about 10 weeks. The dollar was derided for a while as the “Pacific Peso”.

It sank even further as the global financial crisis unleashed panic in mid-2008, blocking the dollar’s then push for parity when it peaked at 98.5 US cents. Within about three months, the Aussie was worth just 61 US cents as investors fretted about the country’s relatively large trade gap and the prospects for its major commodity exports.

The all-time low, though, came in between those two events. The so-called ”tech wreck” in the wake of the bursting of the dotcom boom saw the dollar slide to a nadir of 48.29 US cents on April 2, 2001.

And for the record, the average value of the dollar during its 27-year history as a free-floating currency is about 74.5 US cents. Against a basket of currencies based on the relative size of Australia’s trade, the Aussie dollar is currently at the highest level in just over two years.

The dollar’s surge owes much of its strength to China with its apparently insatiable demand for the Pilbara’s iron-rich dirt. How far the currency climbs may well hinge on continued positive news about Asia growth.

Thomas Averill, managing director of Rochford Capital said the dollar may hit some selling pressure at $US1.03, and may ease back towards the end of 2010.

”I think you’ll see a case of buy-the-rumour-and-sell-the-fact and you’ll see softer Aussie and equity markets into the end of the year,” Mr Averill said.

 

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