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Oh If only we had a crystal ball. The Aussie Dollar has been very high against the USD and GBP for a prolonged period and this may last even longer if Interest Rates here in OZ go up and UK and US interest rates continue to drop under pressure to stem the economic downturn caused in part by the Sub-prime crisis.
The Aussie Dollar is also strong because of the Resources boom which sees a very high demand for our metals, iron ore, gas and coal to support China and India economic expansion. The IMF announced to-day that they expect China to grow by 10% next year which will support continued demand for Aussie Exports which may mean a strong Aussie Dollar will be around for a while.
In the last six months the minimums and maximims have been
min = 2.18 (January, 16)
max = 2.53 (August, 20)
avg = 2.33
So short to medium term if you need to get money over to Australia then I would suggest you drip feed it across weekly or monthly to try and get an average rate.
Long Term the Aussie Dollar is overvalued and will drift lower back towards its PPP (Purchasing Power of Parity)
Technical bit explained : The purchasing power parity (PPP) theory uses the long-term equilibrium exchange rate of two currencies to equalize their purchasing power. it is based on the law of one price: the idea that, in an efficient market, identical goods must have only one price.
For example a Big Mac costs about $3.45 here which is GBP1.54 but it actually costs about GBP1.94 in UK. So it is much cheaper to buy a Big Mac here in aussie dollars at the moment but eventually it will move towards the same cost as in British pounds.
OK so what I am trying to say is that the Aussie Dollar is over valued at the moment but this is being supported by higher interest rates, the resources boom and deman for the currency. This will turnaround but I do not think it will happen in the short term.
So I would suggest you get advice for your own particular situation but think about drip feeding the funds acorss to Australia when needed rather than in a big lump sum. Better to get your money over bit by bit than wait in hope of better rates and find you need to move funds quickly at a bad time!
If anyone has got through all that and not fallen asleep I hope it was of some help.
regards
Liam
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