Should we be buying US dollars now?

[abpanther]

I remember being told ages ago that when our dollar is high we should buy US dollars to sell back when the dollar eventually plummets. Has anyone ever done it before and is this the time to give it a try?

 

[TeamSatan]

Probably better to go to the ASX if you want to get serious about currency trading.

If you plan on going to the US in the next year or so, you could take the punt.

 

[little_aza]

I was thinking the same thing recently. But I decided to hold off for a little while, as interest rates didn't end up going up this month. Interest rate hikes always make our dollar stronger, as foreign investment in Australia (and then obviously demand for our dollars) is increased...though I'm not sure how long it would take to take affect? And then some experts say our rates will increase up to 5 times in the next year.

On the other side of the 'coin', I'm slightly confused at how the Aussie Dollar is high this time around compared to previous times. When it was high in the few years, it was overpriced compared only to the US Dollar. Now it really seems like we're high in comparison to everyone (Euro is now around 70 Euro cents, Pound is about 60 pence). Crashes came due to foreign crisis (GFC, then Greece), as everyone rushes back to the greenback in tough times. Are we genuinely overpriced? Or is demand for our dollar this time genuinely justified?

 

[applesauce]

I am jumping on it this week.

The last 6 times our dollar has risen above 93 US cents within a month it dropped off to below 83.

It depends on what your happy with, I am willing to take the current price and have always been sceptical of "experts" predicting parity+. No doubt it will happen one day but the amount of times it has been predicted and has not eventuated is why I am sceptical. If it drops I am sweet, if it continues up I will be happy with my record highs (at the time) and budget accordingly.

Remember the "experts" predicting petrol being $2/L every time Christmas rolls around... Yet to see it...

You made a good point about the increased interest rate = increase dollar little_aza, but being so close to Christmas if the interest rates rise then consumer confidence will fall so close to retails annual event. I predict the dollar will peak in November if a rates rise occurs, but it won't help the dollar grow once Christmas figures are realised.