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Australians are renowned for overseas travel despite the long haul it takes to get anywhere. And Christmas is holiday time and so many travellers are off to warmer – but wetter parts like Asia at this time. Others head for Europe to brave the bitter cold to take in the rich European culture. Others head to their favorite ski resort. Others happily swim their favorite beach back home. And we all know there are many that don’t even get a chicken bone at Christmas.
Like many economies, Australia has many sub sectors. It must be confusing for those who try to fathom out the media messages all the same. The way I see it is that if you have a good secure job then life is not bad at all and even the young in well healed jobs can dare to buy a home in Mosman or Toorak. If you are unemployed or struggling working class then your future could be bleak. And Christmas can be very miserable.
For those who had off shore this will be a more expensive jaunt as the Ozzie buys you not a lot of Euro or US Dollars. I recall well how holidays approach and friends would pour over the dollar chart as Decmeber approached, wondering when should they buy their currency for their trip. Always a big question. And even the bigger question should you buy or use your ATM and credit card?
Let’s look at the chart first:
Click to Enlarge
Click to Enlarge
Firstly a daily chart and then weekly chart.
The Daily gives you no hope for these coming overseas holidays. You may get some days with minor positive movements but almost not enough to have one extra expensive day in Paris or Aspen. So buying currency now is a lottery – take what you can get. You could spread your foreign currency purchases over a couple of few trances over a few days as you might get a better average. Marginal. But many play the game.
Further out for your 2015 and 2016 overseas jaunts, the news could be a little better. Well even a lot better. But I say ‘could be’ as there are no certainties. But it does appear from the weekly chart the Aussie dollar could improve for the next couple of years.
But with uncertainties on the resources front and the lack luster world growth prospects the dollar could become even softer 2017/2018. So you might just have to spend time on your local beach.
Should you rely more on your ATM/Credit card this overseas holiday? It is possible the dollar could fall further in January. I would tend to take some cash and use a combination of ATM and credit card. The three balance risk.
Being something of a squirrel I have tended in the past to buy a lot more US dollars than I need and usually return with an excess. So I will dig deep into that drawer this season.
Enjoy the ride
Tom Scollon |