The author has been described by News Ltd as an "iconoclast", "Svengali", a pollie's "economist muse", and "pungently accurate". Fairfax says he is a "Renaissance man" and "one of Australia’s most respected analysts." Stephen Koukoulas concludes that he is "85% right", and "would make a great Opposition leader." Terry McCrann claims the author thinks "‘nuance’ is a trendy village in the south of France", but can be "scintillating" when he thinks "clearly". The ACTU reckons he’s "an enigma wrapped in a Bloomberg terminal, wrapped in some apparently well-honed abs."

Monday, April 11, 2011

Foreign central banks driving Aussie dollar demand

This analysis from UBS pretty well reflects my own arguments on the subject:

"Nevertheless with overseas central banks continuing to add commodity currencies to their reserves - the latest IMF Q4 Composition of Foreign Exchange Reserves data shows that the holdings of 'other currencies' which we believe is mainly Australian and Canadian dollars now exceeds both pound sterling and Japanese yen for the first time, domestic investors caught short in March and global investors favouring carry trades, AUDUSD may test 1.04-1.05 now. Thus foreign exchange market participants should be wary of calling a top in the Australian dollar - even though medium term as the Fed ends quantitative easing and starts considering raising interest rates, AUDUSD will head back towards 90-95 cents by year end."

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