A piece from late in the day on Thursday in Australia, from the Sydney Morning Herald interviewing TD Securities' chief Asia-Pacific macro strategist Annette Beacher
- The weak consumer economy makes it difficult for the RBA to raise interest rates
- Makes Australia less attractive ... weakening the demand for the Aussie dollar (as many foreign investors are primarily attracted to the high-yield status of the local currency)
- "We're spending a bit too much time saying inflation isn't high, therefore the RBA doesn't need to hike. We all know the RBA wants a lower currency. But you have to be careful what you wish for.
- If the Fed hikes three or four times, and the RBA sits tight, we won't be high-yield. That doesn't mean the Aussie falls to US72¢. It means it collapses to US62¢. And think of the inflation shock that would cause."
The SMH is ungated, plenty more from Beacher at the article
And some contrasting views, too.
