Sunny forecast for Aussie dollarPUBLISHED : | UPDATED:
Rays of promise for the Aussie. Photo: Greg Newington
The $A is staying solid for investors in a period when the overseas economic picture remains clouded.
That means the Aussie – one of the world’s preferred currencies in recent years – could stay above parity against the $US despite the expectation of an interest rate cut at the next board meeting of the Reserve Bank of Australia, on Tuesday 1 May.
Foreign currency analysts say the rate cut had been factored in by the market, so it may not cause the $A to dip. Also, there are doubts whether the RBA will cut by 50 basis points, which some economists had thought might be a possibility.
With the Aussie poised to stay at these levels, might be a good time to sort out international travel. Read here to find out how to get the best currency rates.
European economic woes continued this week as the Bank of Greece warned it faces a deeper recession than expected. It will be the fifth year of recession for the country, whose economy was recently tipped by the European Union to fall by 4.75 per cent this year.
Debt has also become a political issue in the Netherlands, where outgoing Prime Minister Mark Rutte said it was building to unsustainable levels.
Those continuing economic difficulties could place a strain on the euro.
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Jason Clout Smart Investor