by Alan Thornhill
Dreaming of a new European car, or a holiday in France?
It might be time to act.
After all, the $A hit a new high against the Euro, overnight, touching 83.19 euro cents, before slipping back just a little today.T
That happened after the European Central Bank cut interest rates to an all time low.
That left Australia’s marker cash rate of 3.5 per cent looking very attractive to European investors.
Especially as the comparable rate, in the EU, had been cut to a truly miserable 0.75 per cent.
That drove up the $A, and most analysts expect it to stay high for some time yet.
One analyst said the European Central Bank now clearly expects Europe’s recession to continue for some time yet.
Westpac’s chief currency strategist, Robert Rennie said: “The ECB pointed to renewed weakening in the outlook and heightened uncertainty,” he said.
The Australian dollar also benefited from a surprise rate cut by China’s central bank which lowered its key one-year lending rate by 0.31 percentage points to 6 per cent.
That could boost Australia’s exports to China.
Meanwhile, the $A has more muscle than ever, particularly in Europe.
Don’t waste that.
Alan Thornhill is a parliamentary press gallery journalist.
Private Briefing is updated daily with Australian personal finance news, analysis, and commentary.
Thursday May 23
The Dow Jones Index fell 80.02 points to 15,307.60
Ford Australia says it will close its Australian manufacturing plants in October 2016. Some 1,200 jobs to go.
Hazel Hawke dies at 83
A British soldier is hacked to death in the London suburb of Woolwich, in an apparent terrorist attack
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|Aud To Usd||0.9681||N/A||N/A|
|Bhp Blt Fpo||34.880||-0.390||-1.11%|
|Nat. Bank Fpo||31.700||-1.010||-3.09%|
|Origin Ene Fpo||13.350||-0.120||-0.89%|
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