The Aussie dollar looks to be the next currency to challenge the U.S. dollar with parity.
“Fundamentals suggest the Aussie dollar will continue to rise in 2008,” Mr. Gaffney continues. “The economy is expected to expand by more than 4% next year, and inflation will accelerate. Overseas shipments of raw materials, which contribute about 14% to Australia's economy, helped drive 4.3% growth in the second quarter from a year earlier, the biggest increase in three years.”
A technical analyst at Goldman Sachs suggests a close above the resistance level 89.25 would set the Australian dollar free to reach parity. But crazy as it sounds, that’s not uncharted territory either. The Australian dollar reached $1.20 back in 1981.
The Aussie buck traded at 88 cents this morning. Another 13% move to parity isn’t out of the question.
“Fundamentals suggest the Aussie dollar will continue to rise in 2008,” Mr. Gaffney continues. “The economy is expected to expand by more than 4% next year, and inflation will accelerate. Overseas shipments of raw materials, which contribute about 14% to Australia's economy, helped drive 4.3% growth in the second quarter from a year earlier, the biggest increase in three years.”
A technical analyst at Goldman Sachs suggests a close above the resistance level 89.25 would set the Australian dollar free to reach parity. But crazy as it sounds, that’s not uncharted territory either. The Australian dollar reached $1.20 back in 1981.
The Aussie buck traded at 88 cents this morning. Another 13% move to parity isn’t out of the question.
The Canadian dollar, on the other hand, shows little sign of weakness. The loonie hit a new 31-year high yesterday at a $1.009. “The Canadian dollar has set the standard for commodity based currencies,” Chris Gaffney of EverBank tells us.
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