I don't see how the Australian dollar could drop to 70c within the next 7 months, but I'm not an economist. Any reason?
1. The Aussie dollar was down there before, infact down to 67c.
2. The wind has come out of China's economic sails.
3. The US economy is picking up.
4. The mining boom is near its end.
5. The Australian Government is in the red.
6. The RBA has hinted at more cuts, probably 3 more @ .25% this year.
7. AUS manufacturers and exporters, farmers, beef farmers and car makers are struggling.
8. Low company profits and smaller payee tax revenue has lowered government income.
9. Economists have been saying for several years that the AUS dollar is over valued.
10. Price of gold and other mining resources has been dropping. AUS dollar is closely tied to their price movement.
Absolutely..... AU$ has been on an inflated high for the last couple of years and im afraid this isnt how the balance in the world economy works... everything is bought and sold in US$ which means it is VERY hard for us to sell overseas as we are now too expensive.. we should be down to around 75 - 80c against US$... high AU$ means cheaper imports which kills off domestic manufacture.. all in all, a high dollar sees us go backwards in the long run. There is now a push to bring our dollar down and down it will come.. lower interest rates to boost manufacture and retail sales again implemented.
Problem here is that Australians have now embraced OS online shopping which kills domestic retail... wouldnt be suprised if this is taxed in the near future.
So yes... NIB prices will only rise in the future, but in saying that, we should all be a bit better off anyway due to increased domestic sales.. oh hang on, we have a deficit to pay off.. so scrap that last statement.
NIB prices WILL increase
