International Bonds Weekly : The Kangaroo Report

Australian stocks at at 3 1/2 week low and AUD/USD at a 6 month high.
Mind warp ?

Poor jobs data out on Wed failed to deter the currency from stampeding past 0.94 and we are hanging at 0.9385 now on the EURUSD correction as I type.

Australia in Brief (prices and rates indicative and unverified)


I was so wrong about the AUD back in April, for assuming an immediate bias against the currency right after the CNY’s band widening and just simply forgetting that there are larger forces at work in a risk free world and AUD is the best AAA (all round unlike the NZD which is split Aaa and AA) yielding currency that you can find out there.

The  Australian dollar has been buoyed this week by the RBNZ and the BOE who hiked rates and warned about hiking, respectively.

I believe that reality will come to bear in the weeks ahead and we should see AUD’s 5.41% gain against the USD, year to date and 5.1% since Mar, give up some gains.

Next week we will have the US FOMC (19 June 2am, Singapore time) which will be preceded by the release of the RBA’s June Meeting minutes on 17 June, otherwise we are light on data till month end.

Going by my expectation for a US bond correction after the BOJ (today) and into the FOMC, I expect some good buying opportunities for kangaroo bonds to arise.

Some unverified prices of Kangaroo bonds issued this year.

aud bonds

Related Article :

The Rise of The Kangaroo – AUD Bonds, 4 June 2014

Qualifiers : This is not a recommendation to buy bonds or constitute as investment advice of any form.

Note that buying a bond denominated in another currency carries foreign exchange risk and can result in capital losses or gains.

Bond prices fluctuate on interest rates and credit pressures. Do not buy bonds if you are unfamiliar with the risks involved.