Archive for June, 2019

Aussie: worst performing currency against US dollar this week

By admin | 杭州桑拿

The Australian dollar briefly dipped to a four-and-a-half year low of US85.64¢ on Wednesday. The Australian dollar briefly dipped to a four-and-a-half year low of US85.64¢ on Wednesday.
Shanghai night field

The Australian dollar briefly dipped to a four-and-a-half year low of US85.64¢ on Wednesday.

The Australian dollar briefly dipped to a four-and-a-half year low of US85.64¢ on Wednesday.

The Australian dollar’s dramatic plunge on Wednesday night has made it the worst performing currency against the US dollar this week but it remains resilient against the rest of the world’s major currencies.

The Australian dollar slid nearly 2 per cent to a four-and-a-half year low of US85.64¢ during the New York trading session after the greenback surged on a mixture of positive US jobs data, a Republican victory in the US Senate and a $US27 plunge in the gold price during the New York trading session.

The dollar continued its slide in local trade on Thursday, falling as low as US85.54¢ around midday, despite data showing that employment in Australia rose more than expected last month. During the afternoon the currency eventually clawed back some ground and was fetching US86.17¢ in late trade.

But on a trade-weighted basis – against a basket of major currencies – the Aussie is performing much better, trading about 5 per cent above the year’s low it hit at the end of January and just 3 per cent below the year’s high from early July.

The reason for the discrepancy is an emerging currency war where struggling major economies such as Europe and Japan are easing monetary policy in an attempt to spur business lending and lower their currencies to make their exporters more competitive.

The Reserve Bank of Australia also noted its continued concern about the level of the local currency. In its monthly policy statement this week it reverted to earlier language about the need for a broader and deeper depreciation.

“Key steps by the Bank of Japan and also by the European Central Bank to effectively inject more money into the market, is providing extra liquidity, and that tends to support the Aussie dollar,” said Westpac senior currency strategist Sean Callow.

Mr Callow expects to see the Australian dollar trade higher by year-end and closer to US90¢. He also sees the local currency outperforming the Japanese Yen and the Euro.

Most currency strategists believe that the Aussie dollar’s weakness this year has primarily been a US dollar story, and the result of less central bank stimulus and the prospect of higher rates next year. Both of which point to a stronger US economy and increase investor confidence.

But the extent to which the local currency continues to weaken and remain attractive to investors is being debated by senior experts.

National Australia Bank’s global co-head of foreign exchange strategy Ray Attrill, who sees the local currency testing the bottom of the US85¢ range before Christmas, and heading to US80¢ in 2015, said the Aussie was being driven by a stronger US dollar and a revival in the linkage with key commodities.

“Investors are becoming more confident that the US Federal Reserve will rate rates next year and further downward pressure on key commodities such as gold and iron ore,” he said. Australia is the biggest iron ore producer and among the largest gold producers.

The iron ore price on Wednesday fell 1.5 per cent to a five-year low of $US76.46, with further pressure expected. The latest drop was partly due to reports that China had temporary shut down some steel mills in an effort to clear the air ahead of the coming APEC summit.

Gold is trading at fresh four-year lows just under $US1150 a ounce as investors sell out of the safe haven asset.

The Australian dollar had been trading in a range of between US86.5¢ and US88.5¢ for the past six weeks. A drop in New York trading took it to its lowest level since July 2010.

AUD may return to US90¢

“We also expect further support for commodities,” he added, predicting iron ore sentiment to improve towards the turn of the new year.

Underlining the Australian dollar’s diverging fortunes, since the middle of October and up until the start of this week, the currency surged higher against the euro and yen with gains of 2.7 and 6.6 per cent respectively. This was largely in response to expectations of greater stimulus from Europe and Japan.

“The ECB has its back against the wall,” said Mr Callow, adding that regardless of the outcome of Thursday’s European Central Bank meeting, policy makers will be looking towards boosting the ECB balance sheet.

“This effectively means a greater supply of euros and that should chip away at its value,” he said.

Over the past two years, investor appetite for yield in a low interest rate and stimulus rich environment has been one of the main factors supporting gains in the Australian dollar. The dollar was trading around parity for about two years, between late 2010 and mid 2013.

But NAB’s Ray Attrill doubts that the hunt for yield and more stimulus from Japan and Euro will be enough to stop the Aussie from possibly breaking below US85¢ in the near future.

“I would take the otherwise of the argument. The flipside of the US dollar strength is commodity price weakness. That is coming through irrespective of the US, with clear evidence of Chinese demand growth slowing,” he said.

“I think for the next six months, the risk is that the Australian dollar will underperform even against the yen and the euro. That is particularly because the ECB will be slow to mirror what the Bank of Japan is doing.

“The Aussie will probably perform at least as poorly as the euro and even worse that the yen.

The US dollar extended its lead at the year’s best-performing major currency on Wednesday on news of strong private-sector US job growth and after the Republicans won seven seats in the US Senate, giving them control of both houses of Congress for the first time since 2006. The Republicans have been calling for pro-energy and other business policies.

ME Bank aims for aggressive growth

By admin | 杭州桑拿

ME Bank chief executive Jamie McPhee.Super fund-owned ME Bank is pushing ahead with an aggressive plan to more than double the value of home loans it writes, despite the rapid growth coming at a cost to returns.
Shanghai night field

Chief executive Jamie McPhee said the bank wanted new mortgage settlements to increase from $3.8 billion last financial year to $8 billion in three years’ time. It plans to sell more loans by using technology and targeting a wider range of customers.

The ambitious plan comes after the bank’s loan book grew by 19 per cent in the year to June, mainly due to quick growth in home lending. Profits were also up 28 per cent to $47 million.

However, return on equity remains low at 6.5 per cent, while its cost-to-income ratio is high at 71.1 per cent. These are two areas where Mr McPhee is eyeing significant improvements.

ME Bank is owned by 30 industry super funds and was established in the 1990s as an alternative lender to the big banks. It has never paid a dividend.

Mr McPhee acknowledged that the rapid growth in lending was coming at some cost to return on equity, but said there were moves under way to make the bank more efficient and ultimately pay a dividend to its shareholders in “about four years”.

“We need to get that [return on equity] into the double digits into the not-too-distant future to give our shareholders the appropriate return,” he said.

Part of the improvement is set to come from lower costs, with Mr McPhee saying he planned to drive a reduction in the bank’s cost-to-income ratio to “industry standards” of around the “mid-fifties” for a regional bank, and ultimately even lower.

While ME Bank lacks the economies of scale held by the big four, he argued that it could reduce its expenses substantially because it did not have the costs of running a branch network, which it has closed. Partnering with industry super funds would also allow it to distribute more loans, he said.

It is hoping to achieve the rapid growth through a heavy emphasis on digital distribution channels and by opening itself to more potential customers.

Until August the bank only served customers who were members of a union or an industry super fund, but this policy has been scrapped, and it is also making greater use of brokers to sell mortgages.

The bank has also in recent years spent $70 million on a technology overhaul and closed all its branches in 2012.

ME Bank’s plan comes as the big four and several smaller lenders such as Macquarie eye rapid expansion in the mortgage market – sparking repeated warnings from the financial regulator over lending standards.

2014 Melbourne Cup: Mumm’s the word – Vain Queen may target Lightning Stakes

By admin | 杭州桑拿

The Lightning Stakes carrot is dangling in front of John Sadler with Vain Queen, now he just has to decide if he wants to take the bait.
Shanghai night field

“We’ll give some thought to a race like the Lightning, but the more realistic [option] would be a race like the Sangster Stakes in Adelaide,” Sadler said of his mare, which sped to victory in the group 3 Mumm Stakes on Oaks day.

“With those real good sprinters around at the moment … it might be a bit tough a race for her. But because she goes so well down the straight it is very tempting.”

No doubt fuelling Sadler’s temptation to stay at home rather than a border-hopping mission to Adelaide will be the strength of Vain Queen’s win on Thursday.

Sadler said he did not care one iota if Vain Queen squeaked home by a nostril in the Mumm Stakes. As it turned out, she had more than a little elbow room to spare after exploding under Damien Oliver to flirt with Loveyamadly’s 1100-metre track record at Flemington.

Asked about the time, Oliver said: “I’m not surprised by the way she sprinted. She just exploded when she got clear and it was a super win. She couldn’t have been more impressive than that.”

The winning margin of three-and-a-half lengths may have flattered Bounding and the rest of the beaten brigade, which seemed to be in a separate race of their own.

The ultra-consistent New Zealand-based Bounding, showing no signs of battle scars after emerging from a rough Manikato Stakes, held on for second with Shamal Wind and Lilliburlero dead heating for third.

But the only talking point afterwards was how fast did Vain Queen actually go?

Said Sadler: “It was something else, wasn’t it? I was a little bit concerned she might have been running through the bridle a little bit too hard. She has done that once before here, but she has won four out of five up the straight now.

“One of them was a really good win, but it doesn’t top today. When you get a mare as handy as this, as a trainer you really need to get black type beside her name. We’ve done that now so we can relax.

“I said to my som Tom in the mounting yard, ‘I’m sure that’s the best she’s ever looked’. I was hoping she would just win, but to win like that was really exciting. She has shown today at some stage there might even be a group 1 in her.

“She was very calm and seemed to be in the zone today, like she was looking forward to it.”

No friendships as Klemmer prepares

By admin | 杭州桑拿

After becoming embroiled in a pushing match with fellow Canterbury prop James Graham in his Test debut for Australia against England last weekend, David Klemmer has made it clear that friendships will count for nothing when he comes up against teammates Frank Pritchard, Tim Lafai and Reni Maitua in Sunday’s Four Nations clash with Samoa at WIN Stadium.
Shanghai night field

Klemmer, who has a pre-match superstition requiring him to get off the team bus last, managed to get under Graham’s skin after rubbing the England prop on the head following Greg Inglis’ match-winning try in the 64th minute of Australia’s 16-12 win at AAMI Park last Sunday.

The England prop responded by pushing Klemmer, and referee Gerard Sutton had to separate the pair.

“I loved it,” Klemmer said. “We got stuck into each other a bit but we are both competitive blokes and whatever happens on the field stays on the field.

“The play before, he rushed up and got me in the ribs but on the next play he didn’t get back in the line and he missed the tackle that led to the try, so I rubbed him on the head and said ‘thanks for that’.

“There was a bit of push and shove. He was surprised it was me who rubbed him on the head. I always rub his head at training and he doesn’t like it.”

That incident showed that Klemmer is prepared to do whatever it takes to help the Kangaroos avoid the ignomy of becoming the first Australian team to miss a tournament decider since 1954, and he has already identified Pritchard and Lafai as danger men in the Samoa team.

“It is every kid’s dream to be playing for Australia, so when I got the call-up I took it with both hands,” Klemmer said. “But if we lose here Samoa can go to the final. It is all in the points system, so they are going to come out firing and we have got to do the job on them.

“They are a good team, I reckon they should have won both of their games, so it is going to be a very tough game this week.

“They have good go-forward with David Fa’alongo and Frank and they have some big boys in their outside backs like Joey Leilua, Antonio Winterstein and David Vidot running off the back of that, so we have to stop that. Timmy Lafai is very, very good at that too.”

Asked about his insistence to get off the bus last before last Sunday’s Test in Melbourne, Klemmer said: “Once something works for me I just stick with it.

“I am very superstitous about some things. I have to get off the team bus last, I wear the same undies every week, and I put my left boot on first. I am a bit of a weirdo like that.”

David Hussey set to notch 100 shield games

By admin | 杭州桑拿

A century of Shield games will be a bittersweet triumph for David Hussey.
Shanghai night field

The veteran batsman will play his 100th Shield match when Victoria meets Tasmania at Blundstone Arena in Hobart on Saturday. He will also captain the team in Matthew Wade’s absence.

But the milestone also indicates his lack of favour at international level on the Test match front – a barrier he never cracked.

And it was only a year ago when Hussey was surprisingly axed from the Victorian team for the shield match against Tasmania last November, an experience he conceded “wasn’t easy”.

But Hussey was buoyant when talking about his achievement on Thursday.

He recalled the backyard matches of his childhood in Western Australia, played with brother and star player Michael Hussey. And he is proud of his legacy playing for Victoria.

“He (Michael) has played a lot of Test cricket for Australia, and I play a lot of Sheffield Shield for Victoria, so it has worked out well for both of us,” he said at the MCG nets.

“I haven’t had much time to sit back. I’ve been playing cricket non-stop since making my debut, so I still look back fondly to those early days in the backyard with Mike. We still talk about that now.”

Hussey will be the sixth cricketer to reach the 100-game milestone. His predecessors include Brad Hodge (140 matches), Darren Berry (129), Dean Jones (110), Matthew Elliott (103) and Ray Bright (101).

Of that group, the 37-year-old was the oldest when he made his debut for Victoria. And he is, of course, somewhat of a senior in the team – the subject of playful banter with teammates. He has grown accustomed to being told by younger players to “get a rinse” or “get a haircut”, he said.

And when a journalist asked him for a “realistic” estimate of the number of seasons he had left – in a manner mirroring a child begging a parent to end a long car ride – the batsman laughed. And he was frank.

“Not many seasons left to go,” he said.

“There are too many young kids coming through. I’ve always said I would never stand in the way of a young kid who is going to play for Australia. So if that means this year I’ll be forced out, then so be it.

“I still believe there is a spot for an older person on this game just to teach the younger kids how to bat for a longer period of time …  that’s the key.”

He pointed to Peter Handscomb, Marcus Stoinis and Alex Keath in his list of rising stars with potential to play for the country.

“These boys have a big future in the game. Hopefully they will get a few runs for us this week.”