Courtesy of Mish.
Curve Watchers Anonymous has its eye on the Australian dollar. As expected, it has taken a big dive in conjunction with a housing bust and a slowdown in China that impacts the demand for commodities.
click on chart for sharper image
The only thing surprising to me about this plunge is how long it took, but here we are.
Aussie Falls to Lowest in More Than Two Years
Bloomberg reports Aussie Falls to Lowest in More Than Two Years as Home Loans Slow
Australia’s dollar fell to the lowest in more than two years versus the greenback after home-loan approvals grew at the slowest pace in three months, boosting the case for further cuts to borrowing costs.
The Aussie slid against all but one of its 16 most-traded peers amid speculation the U.S. central bank will reduce stimulus this year, narrowing Australia’s interest-rate advantage. Standard & Poor’s lifted the U.S. credit outlook to stable from negative, supporting the view that the Federal Reserve could taper asset purchases under its program of quantitative easing. New Zealand’s kiwi dollar fell.
“Housing is the one area most likely to make up for the mining investment downturn, and it’s disappointed,” said Joseph Capurso, a Sydney-based foreign-exchange strategist at Commonwealth Bank of Australia.
Australian Insolvencies Hit Record
Why anyone would think housing would make up for a downturn in mining is certainly a mystery given Australian insolvencies hit record for month of April.
A new April record has been set for Australian companies becoming insolvent. Some 941 firms were put under administration, marking the highest tally for that month since records were first made public in 1999.
Some 941 firms were put under administration, according to an FTI Consulting analysis of Australian Securities and Investments Commission records.
Almost 3450 companies have gone into administration so far this year, compared with 3524 during the same period in 2012….
