Aussie dollar - looking weaker

The Australian dollar is likely to fall off in the coming months as a softer Chinese and US economies tranlates into lower commodity prices. The highly indebted household sector will prevent the government from raising interest rates, though a weaker $A and tight labour markets suggests some upward move in interest rates will be required to quell inflation. There are already signs that retail sales...

Japanese Yen - subdued for now

The Japanese yen is a side-show compared to the $US as the US economy powers ahead and the Fed fight inflation fears with higher interest rates. The Yen will however out-perform the Euro since its economy is growing stronger. There is also considerable interest in the Japanese equity market as it benefits from a property-inspired boom.- Andrew Sheldon www.sheldonthinks....

Euro - nothing happening

The Eurozone remains a disappointment - given the slow growth and lack of resolve to establish a unified monetary policy framework. Progress with labour reform is also slow.The Euro will be weak as the US and Japanese economy strengthen, particularly since the Eurozone will not want to raise interest rates.- Andrew Sheldon www.sheldonthinks....

US Dollar - range bound

The $US has broken out of its long term downtrend, though its likely to test its lows as oil prices and Asia`s mercantilist policies conspire to boost the US deficit. In the short to medium term however the US economy is growing strongly and the Fed is raising rates, so with the Eurozone recording subdued growth - except a stronger $US. The Japanese economy is looking stronger, however the Yen will...

Indonesian Rupiah - up on growth

Ever since the current president of Indonesia was elected, I have been very excited by Indonesia`s prospects. The reasons are thus:Leadership: The values and leadership style of PM Dr Susilo Bambang Yudhoyono are conducive to stable government. The PM is US-educated so there is some hope that he will embrace western values. He has also been concillatory with US and Australian governments. Tourism:...

Philippines Peso - down on reform uncertainty

The Philippines peso is not one of the easist currencies to trade, but having visited the country in recent weeks, the country strikes me as an emerging good story. There are a number of dynamics shaping up to propel this country:Constitutional crisis: The Arroyo government was close to impeachment in recent weeks, and though it looks like she will have a reprieve, a strong consensus emerged for reform....