Peter Horsfield, founder of financial advice business Smart Advice agrees that as the US economy recovers and global investors move their money to less volatile economies, the global reallocation of investments and currencies is creating both headwinds and gains for Australian share market investors.
He suggests winners from the recent downward movement of the currency will be travel and tourism business, as well as Australian companies looking to merge with firms domiciled in other jurisdictions.
However, Horsfield says sectors set to face higher operational costs as a result of the lower dollar will include domestic banks, local property firms and consumer retailers selling imported goods such as electronic devices and vehicles.
As to where the dollar is heading, he says, “anyone who says they can predict future currency directions is best avoided when making investment decisions or listened to only for entertainment purposes.”
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