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What an expensive Aussie dollar means for investors

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  • September 11 2017
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Invest

What an expensive Aussie dollar means for investors

By
September 11 2017

The price of the Australian dollar reached a two-year high last week, which one wealth management and accounting firm says poses both challenges and opportunities to Aussie investors.

What an expensive Aussie dollar means for investors

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By
  • September 11 2017
  • Share

The price of the Australian dollar reached a two-year high last week, which one wealth management and accounting firm says poses both challenges and opportunities to Aussie investors.

Prime Financial Group, wealth management, retirement planning, retirement savings, Australian dollar, foreign exchange, interest rates, reserve bank of Australia

The Australian dollar reached 80.99 cents against the US dollar last week, which Prime Financial Group noted has many implications.

Firstly, Prime said in a statement, the high price of the dollar will likely put pressure on the Reserve Bank of Australia to keep rates low despite the optimism from many commentators that rates could rise sooner than was previously expected.

Prime also posited that the strength of the Australian dollar is “doing more harm than good” to the Australian economy’s growth prospects.

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“The rising Australian dollar puts pressure on our domestic productivity, and acts as a drag on local growth,” the statement said.

Prime Financial Group, wealth management, retirement planning, retirement savings, Australian dollar, foreign exchange, interest rates, reserve bank of Australia

However, this growth is making it more attractive to invest in international share markets, Prime said, and is creating investment opportunities by contributing to underperformance on the part of “several high-quality stocks” that generate much of their revenue from foreign markets.

 

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