The Australian dollar was today under further pressure after a recent period of weakness in the currency. With Ben Bernanke indicating that the Fed would push forward with its tapering of monetary policy coupled with today's drop in the Chinese Purchasing Managers Index by HSBC, the Australian currency has dropped from 103 cents in early May to 92.42 cents at 11.30am.
As one of the most traded currencies in the world the Australian dollar is often impacted when there are large rises and falls in commodities in global markets. It is often seen as a risk trade and when the commodities cycle indicates falling future prices it may move investors towards less risky currencies such as the US dollar.
The views expressed are the subjective opinion of the article's author and not of FinancialAdvisory.com
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