The capitalist Titanic is on its way down dragging my hopes to go to Japan with it.
Forex Summary
- The Australian dollar is now at 5-year lows against the USD trading at less than 62 cents, and is expected to fall sub-60c. It has fallen 39% since July.
- The Reserve Bank has for the first time since 2002 intervened in the market to stabilise the falling currency.
- The Australian dollar is now at all-time record lows against the Yen trading at 55 yen. It has fallen 47% against the Yen since July.
- The news does not get any better for the Hong Kong dollar now trading at 4.80, having fallen 40% in 3 months.
There are many factors, but a phenomenon called carry-trade is a leading factor.
- Interest rates in Japan are at 0.5%, whilst Australian interest rates are at 6%.
- Investors borrow funds from Japan and invest them in Australian markets, whether share or fixed investments. During good economic times, the yen will be sold off for the Australian dollar as investors flock here to make money.
- Now that the economy has gone south, investors are pulling their funds out and converting it back to yen to repay their loans and lock in their profits. Hence the capital shift out of Australia causes our dollar to depreciate. That's why the Yen is now as strong as it is.
Melbourne is to get new feature in its skyline when it launches a new observation wheel similar to the London Eye next month. The Southern Star Observation Wheel will open soon, and is the only permanent observation wheel structure in the southern hemisphere. It will stand at 120m high and is located in the revitalised Harbour Town area in Docklands, west of Melbourne CBD.The new hip place to be this summer is not Tokyo, but Melbourne.
benny
benny
Post a Comment [5 comments]
spare a thought for those poor souls still stuck overseas...
my spending power has now dramatically decreased :(
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Wednesday, October 29, 2008 1:23:00 am
Yeah Melbourne might not be cheap, but at least I don't feel like I'm losing out coz of the exchange rate!
Pang- but you would've exchanged your money already... You're using money you exchanged previous to this collapse- so you're more than fine =D
benny |
Wednesday, October 29, 2008 3:36:00 pm
Yes and no. I didn't exchange all my money in one big hit; every few months, when I was running out, I would send some over here.
And unfortunately, I'm probably going to fall about one month short in terms of RMB, even moreso if I do travelling, and go on my planned spending spree in HK next month, so that means exchanging at least one more time, at today's crappy rates.
Aiya, looks like time to tighten the budget as much as possible, and instead of five lavish dishes + soup, or a banquet every meal, resort to plain rice + soy sauce...
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Wednesday, October 29, 2008 7:47:00 pm
One month short... well I'm sure the AUD will rise for the short term before we start cutting interest rates again. I suppose that 11 months of good exchange rates is enough for you- 1 month of bad rates isn't too bad considering all the savings over the last 11.
You can continue with those lavish dishes I'm sure. It's not that expensive anyway. It's really nothing...
benny |
Thursday, October 30, 2008 7:51:00 pm
same with me benny!! i might not go to HK or japan ar coz of the stupid aussie dollar T__T
boohoo no holiday to go to tim~~ maybe head off to melbourne then :p