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28 Aug 2013
RBA's Edwards reminds AUD bulls not to mess with bear trend
FXstreet.com (Barcelona) - Following last week's article titled 'Hard to build sustainable AUD bullish case' in which a dead end road to prevent further AUD depreciation was argued - on the basis of the outlook for the cash rate and the AUD being 'intertwined' - the WSJ published an interview earlier Tuesday with RBA board member John Edwards, saying the Aussie dollar remains still too high, which serves as a nice reminder of the RBA line of thinking.
Key Quotes - WSJ
"The Australian dollar is still too high and remains a brake on economic growth, but it is likely to fall further in coming months, a Reserve Bank of Australia board member said."
"Though down nearly 15% since April, the currency needs to weaken more to cushion the economy from the rapid cooling of the mining-investment boom."
"It is still a bit too strong to help, to the extent it could, in the transition we need to make."
"The prices we're getting for our minerals are still very high by historical standards, and production is going up and up all the time."
""We are seeing some good signs that the transition is happening. Housing is a bit stronger but not as strong as I think we will need to see it," Mr. Edwards said. "Exports have been good, but we do need to see a bit more in the area of non-mining investment, and we'll need to see it a bit faster in housing."
Key Quotes - WSJ
"The Australian dollar is still too high and remains a brake on economic growth, but it is likely to fall further in coming months, a Reserve Bank of Australia board member said."
"Though down nearly 15% since April, the currency needs to weaken more to cushion the economy from the rapid cooling of the mining-investment boom."
"It is still a bit too strong to help, to the extent it could, in the transition we need to make."
"The prices we're getting for our minerals are still very high by historical standards, and production is going up and up all the time."
""We are seeing some good signs that the transition is happening. Housing is a bit stronger but not as strong as I think we will need to see it," Mr. Edwards said. "Exports have been good, but we do need to see a bit more in the area of non-mining investment, and we'll need to see it a bit faster in housing."