Last year in my article Currency hedging – 3 things to consider I introduced the concept that exposure to foreign currencies can potentially be an added source of unnecessary risk to your global equities investment when looking at certain currency pairs. Today I’m going to highlight a few specific international regions and global sectors where
The Australian dollar have proven stubbornly resilient in recent months, raising doubts about my year-end call that it would fall to US65c. That said, a number of forces appear to be now conspiring to push the little Aussie battler lower in the months ahead.
China’s exchange rate policy has led to much angst and confusion across global markets over recent months. To their credit, the Chinese authorities have claimed they will try to maintain a “stable” value for Yuan against a basket of currencies this year. The problem, however, is that the Chinese real exchange rate is already uncomfortably
The Reserve Bank of Australia’s (RBA’s) decision to leave official interest rates on hold in July was no surprise to the market. That said, there were some very subtle, but important aspects to the RBA’s post-meeting policy statement that investors should be aware of.
Following the Reserve Bank of Australia’s decision to cut interest rates last month, ongoing weakness in commodity prices, and heightened expectations that the United States Federal Reserve will raise interest rates within coming months, it’s no surprise the Australian dollar has taken a tumble of late. Indeed, after a slight firming trend following the February
The Australian dollar has had a notable fall in recent months – and, in fact, these falls could start to help economic growth by making trade-exposed sectors more price competitive. But while any such benefit associated with falls may be true at the margin, this is only a partial analysis of the overall effect on
With the Australian dollar seemingly on a downward trend, investor interest in gaining offshore investment exposure is growing. In our recent Portfolio Construction post, we looked at some strategies to implement ‘risk-on/risk-off’ for domestic equities exposures. In this post, we look at how currency can be used to de-risk your international share allocations.
Over the past forty years the United States dollar has experienced several boom-bust cycles spanning between 6 and 10 years. Both history and relative economic fundamentals suggest we may now be in the relatively early stages of the next great US dollar bull run.