FOREIGN EXCHANGE RATES – AUSTRALIA

Kiwi cut raises the prospect of negative interest rates

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Original article by Adam Creighton
The Australian – Page: 4 : 8-Aug-19

The Australian dollar reached a 10-year low of $US0.6680 in local trading on 7 August, after the Reserve Bank of New Zealand reduced official interest rates by 50 basis points to 1 per cent. Central bank governor Adrian Orr has not ruled out the prospect of negative interest rates or measures such as quantitative easing. The RBNZ’s move is likely to strengthen the case for further monetary policy easing in Australia before the end of 2019.

CORPORATES
RESERVE BANK OF NEW ZEALAND, RESERVE BANK OF AUSTRALIA, BLOOMBERG LP, STANDARD AND POOR’S ASX 200 INDEX, JP MORGAN AUSTRALIA LIMITED, HSBC AUSTRALIA HOLDINGS PTY LTD, UNITED STATES. FEDERAL RESERVE BOARD, AUSTRALIA. DEPT OF THE TREASURY

US Fed rate cut gives Reserve Bank cover

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Original article by Vesna Poljak, Luke Housego
The Australian Financial Review – Page: 1 & 31 : 2-Aug-19

Andrew Canobi of Franklin Templeton says the US Federal Reserve is still widely tipped to announce two further interest rate cuts over the next year. However, he says the central bank is likely to pursue less aggressive monetary policy easing than had been recently forecast, after chairman Jerome Powell signalled that the rate cut on 1 August will not be the start of "a long series of rate cuts". The more hawkish tone from the Federal Reserve will be welcomed by the Reserve Bank of Australia, as it should reduce any upward pressure on the Australian dollar.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, FRANKLIN TEMPLETON ASSET MANAGEMENT LIMITED, RESERVE BANK OF AUSTRALIA

Shares hit by fresh global growth fears

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Original article by David Rogers
The Australian – Page: 17 & 28 : 26-Mar-19

The bearish sentiment that saw the S&P/ASX 200 fall to a three-month low on 25 March also weighed on the local bond market, with the yield on Australian 10-year bonds reaching a record low of 1.756 per cent. Growing concern about the outlook for the global economy also prompted a decline in the yield on US government bonds, with the yield curve inverting for the first time since 2007. Meanwhile, the Australian dollar reached an low of $US0.7066 in local trading, and Steven Miller Grant Samuel Funds Management expects it to fall further.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, GRANT SAMUEL FUNDS MANAGEMENT PTY LTD, UNITED STATES. FEDERAL RESERVE BOARD, FEDERAL RESERVE BANK OF CHICAGO

Dollar dives on expected cut to RBA cash rate

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Original article by David Rogers
The Australian – Page: 17 & 27 : 7-Mar-19

The Australian dollar fell to a two-month low in local trading on 6 March, in response to the latest GDP data, while the money market has now fully priced in an official interest cut by October. Meanwhile, Reserve Bank governor Philip Lowe has told a business summit that the central bank still has the flexibility to raise or lower the cash rate as required. He also said the downturn in house prices is unlikely to affect economic growth.

CORPORATES
RESERVE BANK OF AUSTRALIA, STANDARD AND POOR’S ASX 200 INDEX, JP MORGAN AUSTRALIA LIMITED, MACQUARIE GROUP LIMITED – ASX MQG, WESTPAC BANKING CORPORATION – ASX WBC, UBS HOLDINGS PTY LTD, AMP LIMITED – ASX AMP, NOMURA AUSTRALIA LIMITED, CAPITAL ECONOMICS LIMITED

China slaps ban on exports

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Original article by Perry Williams, Glenda Korporaal
The Australian – Page: 1 & 2 : 22-Feb-19

The Australian dollar fell by more than one per cent on 21 February following reports that China has imposed an indefinite ban on thermal coal exports from Australia entering five ports in northern China. Trade Minister Simon Birmingham has asked Australia’ s ambassador in Beijing, Jan Adams, to investigate the apparent ban. Australia exported around $2.1 billion worth of thermal coal to the five ports in 2018. It has been suggested that China’s action could be linked to Australia’s ban on technology company Huawei.

CORPORATES
AUSTRALIA. DEPT OF FOREIGN AFFAIRS AND TRADE, HUAWEI TECHNOLOGIES COMPANY LIMITED, AUSTRALIAN STRATEGIC POLICY INSTITUTE LIMITED, MINERALS COUNCIL OF AUSTRALIA

HSBC warns of dollar drop to US66c amid challenges

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Original article by Sarah Turner
The Australian Financial Review – Page: 31 : 15-Feb-19

The Australian dollar is currently trading at around $US0.70, but HSBC says the latest economic data means it is unlikely to rise above this level. HSBC is particularly bearish about the outlook for the dollar, forecasting that it will test the $US0.66 level by the end of 2019. The Commonwealth Bank in turn has scaled back its year-end forecast for the currency from $US0.75 to $US0.72, citing factors such as the outlook for both global growth and the Australian economy.

CORPORATES
HSBC AUSTRALIA HOLDINGS PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, RESERVE BANK OF AUSTRALIA

Aussie tipped to dive 15pc this year

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Original article by Timothy Moore
The Australian Financial Review – Page: 31 : 25-Jan-19

Capital Economics has downgraded its forecast for the Australian dollar in 2019. The firm has warned that the currency could test $US0.60 and remain at around this level in 2020. It had previously expected the currency to trade at about $US0.65 in 2019 and $US0.70 in the following year. Capital Economics is also bearish about the outlook for Australia’s key export commodities, iron ore and coal, while it expects official interest rate cuts in 2019.

CORPORATES
CAPITAL ECONOMICS LIMITED, MORGAN STANLEY AUSTRALIA LIMITED

Revenge of machines: dollar’s flash crash to 10-year low

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Original article by Michael Roddan
The Australian – Page: 15 & 20 : 4-Jan-19

The Australian dollar fell to $US0.6741 early in local trading on 3 January, its lowest level since 2009. The so-called ‘flash crash’ event was attributed to algorithmic trading. However, the currency recovered much of the lost ground and was fetching $US0.6968 late in the local trading session. Asian currencies, the US dollar and the British pound also fell sharply. Treasurer Josh Frydenberg says many factors influence the direction of the Australian dollar, noting that it is the world’s fifth-most traded currency.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, PEPPERSTONE GROUP LIMITED

Miners’ shares soar as $A gold price hits record high

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Original article by Paul Garvey
The Australian – Page: 20 : 4-Jan-19

The price of gold in Australian dollar terms reached a record high of more than $1,859 an ounce on 3 January, eclipsing the previous peak of $1,819.44 an ounce in July 2016. The rally in turn boosted the share prices of local gold producers, with Newcrest Mining advancing 4.3 per cent and Evolution Mining, Northern Star Resources and Saracen Mineral Holdings rising to new highs.

CORPORATES
NEWCREST MINING LIMITED – ASX NCM, EVOLUTION MINING LIMITED – ASX EVN, NORTHERN STAR RESOURCES LIMITED – ASX NST, SARACEN MINERAL HOLDINGS LIMITED – ASX SAR, BARRICK GOLD CORPORATION, NEWMONT MINING CORPORATION

Dollar rides rollercoaster of US mid-terms

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Original article by Melissa Yeo
The Australian – Page: 17 & 27 : 8-Nov-18

The Australian dollar peaked at $US0.7272 in local trading on 7 November, after the Democrats gained control of the US House of Representatives in the mid-term elections. The currency had fallen to $US0.7217 after it became clear that the Republicans would retain control of the Senate, erasing the gains it had made earlier in the session. Shane Oliver of AMP Capital says the Australian dollar may also have benefited from a delayed market reaction to the Reserve Bank’s latest economic forecasts.

CORPORATES
AMP CAPITAL INVESTORS LIMITED, RESERVE BANK OF AUSTRALIA, DEMOCRATIC PARTY (UNITED STATES), REPUBLICAN PARTY (UNITED STATES), BNY MELLON INVESTMENT MANAGEMENT, RBC CAPITAL MARKETS, STANDARD AND POOR’S ASX 200 INDEX