Jump to content
House Price Crash Forum
Sign in to follow this  
interestrateripoff

Australia And India Raise Interest Rates

Recommended Posts

http://www.nytimes.com/2010/11/03/business/global/03rates.html?_r=1&ref=business

HONG KONG — Australia and India raised interest rates on Tuesday, in separate moves that highlighted the growing contrast between the Asia-Pacific region’s rapid growth and the still-fragile recovery in other parts of the world.

While central banks in the United States, Europe and Japan are still having to prop up their economies with very low interest rates — and the Federal Reserve is expected to announce additional pump-priming measures this week — many of their counterparts in developing Asia and in fast-growing Australia have been gradually nudging up the cost of borrowing again during this year.

Australia’s move to bump up its key cash rate to 4.75 percent, which few economists had expected, was the latest in a series of increases, which began in October 2009 and now totals 1.75 percentage points.

India, too, has pushed up rates gradually this year. On Tuesday it added another quarter of a percentage point to the repurchase rate for short-term lending, making it 6.25 percent, and to the reverse repurchase rate for short-term borrowing, now at 5.25 percent.

The Reserve Bank of India cited rising inflation pressures, which have become the major bugbear for policy makers throughout the region, as the reason for the latest rate increase.

So if you want to get a return on your cash you know where it needs investing trouble is won't this cause an inflow of cash looking for a return stoking inflation further?

Share this post


Link to post
Share on other sites

I spotted yesterday that housing had gone up by 18% in Australia last year.

The currency's already far too strong, and putting up interest rates isn't going to help. Australia may be fine for now, but with the wine producers' plonk no longer being cheap to the rest of the world (US dollar parity - amazing), and housing being incredibly expensive, if/when the commodities bubble bursts Aus will be in real trouble.

I'm sure Aus is quite happy with Bernanke's money printing, though - should keep the commodities bubble growing for a few months yet.

Share this post


Link to post
Share on other sites

Oz produce 40% of the coal traded in the world export market, I can't be bothered to work out the numbers, but I'll bet in energy terms it dwarfs Saudi's oil production. Looks a pretty secure position to me. If our bubble was part financed by North Sea oil, you wait until you see the size of the one growing in Oz.

Share this post


Link to post
Share on other sites

http://www.nytimes.com/2010/11/03/business/global/03rates.html?_r=1&ref=business

So if you want to get a return on your cash you know where it needs investing trouble is won't this cause an inflow of cash looking for a return stoking inflation further?

mate the carry trade is back in full force, and its not just the JPY this time - just about any world currency will do. When it snaps back it does it in style tho - witness the last time when the AUD went from near parity to 63c in a pretty short space of time.

FWIW - I have started moving money from AUD to GBP. I'd rather be too early than too late B)

Share this post


Link to post
Share on other sites

Oz produce 40% of the coal traded in the world export market, I can't be bothered to work out the numbers, but I'll bet in energy terms it dwarfs Saudi's oil production. Looks a pretty secure position to me. If our bubble was part financed by North Sea oil, you wait until you see the size of the one growing in Oz.

Plus Iron ore, natural gas, Uranium and anything else that can be dug out of precambrian shields.. although I doubt that Aus coal production matches SA oil production in energy equivalent.

Share this post


Link to post
Share on other sites

Plus Iron ore, natural gas, Uranium and anything else that can be dug out of precambrian shields.. although I doubt that Aus coal production matches SA oil production in energy equivalent.

lets not forget the REAL driver in the OZ Economy...HOUSING......why invest in energy when you can BUY HOUSES?

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 146 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.