Thursday, January 10, 2008

Australian Trade Gap Shrinks, Aussie Rallies

Good news out of Australia, and a nice job by Bloomberg comparing the rate situation between Australia and the US. Bottom line is the US is basically already in a recession and rates here are coming lower - Australia is still hot and rates are going higher. That is bullish for the Aussie dollar.

By my count, this is the highest the Aussie's been since late November, marking an entry point for me.

I'm glad to be back with the Aussie dollar, though the weight of the carry trade continues to hang on what should be a bright future. I expect the Aussie to begin a climb towards parity with the US dollar, but it sure won't be a smooth ride.

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