Harvinder Kalirai Quotations

We did expect a sharp deterioration of the trade balance. The real story on the trade numbers is that the import surge reflects very solid domestic demand.

There are a few signs of cracks beneath the surface in the U.S. economy, starting with the weak durable goods and confidence figures last week, and now with the rise in oil.

The Australian currency may rise to US80c over the next month.

We got the spark from the PPI today,

At these levels, the Australian dollar is looking attractive. A decline in U.S. interest-rate expectations is beneficial for Australia.

If you look back to 1994 when the Fed was hiking rates continuously, after every rate hike the Fed adopted a neutral bias. However, the tightening cycle continued until early '95, for a total of 300 basis points (3 percent). We are not looking for that type of tightening cycle this time, but nevertheless it does suggest that the neutral bias does not preclude further rate hikes down the road.

The trend is still toward wider deficits, so this is a concern for the U.S. dollar. I continue to forecast it lower.

July was much stronger than expected, but when you factor in the revisions to June, there's only a 0.4 percent increase ... I think these numbers are very close to consensus forecast.

Manufacturing is recovering -- and the recovery, in fact, is accelerating.

With oil prices back near record levels, one can bet that the Brazilians are increasing ethanol production. This means less refined sugar and higher prices.