Press release
World Financial Market News...
The world’s financial markets continued their turbulent end to 2008 with widespread instability and persistent speculation that 2009 will bring a global recession. In equity markets shares fluctuated on rescue package hopes.
In the US, the NYSE took comfort from a rescue of US banking giant Citigroup suggesting the US government would not stand on the sidelines and watch an institution of such importance to the US financial system fail.
The outlook for the global economy remains a concern as Japan and Europe drift into recession, followed closely by the United States, with recent data suggesting that China won’t avoid a slowdown.
Australia & New Zealand...
The Australian Dollar found some comparative stability during November as recent declines in the Aussie’s buying power began to level out. Following a near 40% move in the previous 3 months, support was found above the $0.60 level despite concerns over the health of the Australian economy resulting from the global slowdown and weakening commodity prices.
The RBA has cut it’s economic forecasts for 2009/10 fearing a contracting economy, although it remains mindful of the inflationary effects of a weaker Aussie dollar. A slumping demand for commodities is expected to have potentially severe implications for Aussie mining firms with subsequent job losses amongst the reverberations.
In New Zealand the Kiwi dollar failed to derive much support from better than expected trade balance and business confidence figures, continuing it’s slump against the major currencies.
Following world–wide interest rate cuts and softening inflation, the RBA & RBNZ continue to face heavy pressure to take similar measures.
Rest of the World...
The economy of the United States continues to lurch from one crisis to another, with repeated attempts to calm the markets being undermined by political wrangling and tumbling confidence. Attention is now firmly focused on the financial team being amassed by President elect Barack Obama, and the policies that will be adopted to deal with the financial crisis. Recent turmoil has been compounded by soaring unemployment, poor housing data and the potentially imminent collapse of the ‘Big 3’ US car manufacturers.
In the UK Prime Minister Gordon Brown continued to earn plaudits for his handling of the UK’s economic problems, although debate rages as to the long term effects of government intervention. The UK taxpayer now owns 58% of market stalwart RBS, and with a recent 2.5% cut in VAT there is much speculation as to how the government will continue to fund it’s support of the banking establishment.
Eurozone data continued to be dominated by a slowdown in the zone’s largest economy Germany, and economic pressures across the continent, although the Euro has remained resilient thus far.
AUD/USD...
AUD/USD - (1st Jan '08 - 1st Dec '08)
Oct-Nov 08 saw AUD/USD in a more stable range, although year to date volatility is almost 40%.
AUD/NZD...
AUD/NZD -
(1st Jan '08 - 1st Dec '08)
Recent months have seen a resurgent AUD$ against Kiwi, although still far short of July’s high 1.2967.
AUD/ZAR...
AUD/ZAR - (1st Jan '08 - 1st Dec '08)
AUD/ZAR has witnessed 33% volatility in 2008 from a low of 5.93 to a high of 7.9458 – all inside 2 weeks in October!
GBP/AUD...
GBP/AUD -
(1st Jan '08 - 1st Dec '08)
Volitility in GBPAUD for 2008 remains over 25% - A difference of over AUD$34,000 on £50k
Source HiFX Currency update for 2008
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