" Are these assumptions correct or are any scenarios not considered?"
Exchange rate:
The fundamentals indicate to me that the Value of the AUD is more likely to fall rather than rise.
Why is that so?
Countries are a business like any other, the Fiat currencies they issue are akin to shares in a company and their value in comparison to other countries currencies is measured by how well the business of government is being run.
If the business is being run at a profit (surplus) the vale of the currency will rise, if it is being run at a loss (deficit) the value of the currency will fall.
The current labour government who manage the country has very ambitious revenue forecast assumptions in an attempt to balance all the stuff they are giving away to attract votes. They are also loading the achievers with heavier tax burdens which will discourage achievement and ultimately lead to people working in the dark and lower tax collections will result compounding the deficits.
If, as is very likely, the next government is a coalition between labour and the greens the value of the currency will sink like a stone. Inflation will become rampant as it did in the Gough Whitlam era. The rich will get into as big a negative cash balance as they can with debt and own as many appreciating assets as they can get their hands on and as a result become super rich. The poor will unfortunately have backed the wrong horse and become a lot poorer.
It's very likely the next American government will be republican and managed compassionately but profitably, in spite of the Trump card, as its mission will be to encourage the achievers, not be to prop up the low achievers.
AISC:
AISC is a cost that is based on feed grade assumptions and is not a reliable measure of a miners costs.
84% of HGO's AISC is driven by the volume of ore that is mined and processed.
If the cu price rises and HGO has spare processing capacity they will drop the cut off grade, increase the AISC and make more money.
If the copper price falls they will increase the cut off grade lower the AISC and hopefully have access to enough higher grade ore to keep the plant full and if they do that well they could make more money.
HGO Price at posting:
7.7¢ Sentiment: None Disclosure: Held
