subject: Aussie back in casino mode – Online Casino Games [print this page] Author: Sports Betting Author: Sports Betting
Online Casino Games - Aussie back in casino mode In the first half of 2008 commodity prices were surging, both riding and attracting an unprecedented wave of speculative investment. And the Australian dollar peaked in July around 97.5 US cents and 74.1 on the Reserve Bank's trade-weighted index. In a note to clients over the weekend, South Africa's Standard Bank's commodities analysts noted that speculative activity in US commodity contracts is back to where it was in May-June 2008. The Aussie jumped more than a cent on Friday night and today's TWI is likely to be close to 72 when the RBA calculates it this afternoon. Standard Bank's Walter de Wet writes that the difference is that most economies were on the decline in May 2008, whereas now they are showing signs of recovery, promising the speculators greater length. Throw in the clear correlation between the rise in commodity speculators going long and the US dollar weakening and it looks like the Aussie is set for a ride as wild as a hedge fund casino betting. (I'd argue that there's a good deal of chicken-or-the-egg in the greenback/commodity price correlation as punters run for commodities partly as a bet on the US dollar falling and commodity prices tend to rise because the US dollar falls.) Just about every pet shop parrot is talking up our currency reaching parity with the greenback. That looks a popular bet, but such consensus often is a sign for caution. The Standard Bank research note points out that the current commodity price surge is occurring despite large inventories and prices being well above production costs which, in fundamental theory, should be limiting the upside for this rally. Walter de Wet reckons the speculative surge could mean commodities will remain partly a play on the US dollar and that they could suffer sizeable corrections as the increased punting activity means greater volatility. Wild swings Standard Bank, in keeping with its South African heritage, remains in the commodities bull camp on longer-term fundamentals, but it looks like the current burst of optimism presages some wild swings in 2010. The Aussie's current rally isn't just against a falling greenback as we've been gaining on the TWI as well. The Reserve Bank's commodity price index shows our commodities were outpacing the Aussie in November and December - gaining in both Aussie and SDR (special drawing rights) terms. Meanwhile the source of much of our commodity demand, China, has claimed Germany's title as the world's largest exporter. China's exports jumped 17.7 per cent in December, according to Xinhua, giving total 2009 exports of $US1.2 trillion. That's down 16 per cent on 2008, but other countries' exports have fallen further. Before the anti-China lobby gets too excited, the country's trade surplus fell by 34.2 per cent to $US196.1 billion, reflecting the annus horribilis for global trade. Australia was a rare exception, increasing its exports in 2009 - something that hasn't gone unnoticed by the world's commodity and currency speculators. Welcome back to life in the online casino games. About the Author:
