Australian Dollar Reaches an All Time Low in One Month
The strengthening of the US dollar directly resulted in the weakening of the Australian dollar. In the past week, following the announcement of US election results, the Australian dollar showed a sudden decrease in value. In the opening of the new week, the Australian dollar hit an all-time low in the past one month. The winning of Donald Trump has resulted in such an effect of on the Australian dollar.
The AUD/USD pair reached 0.7518, which is the lowest in the past month. It slightly increased to 0.7533 which is still lower compared to the previous few weeks. The reversal in the prices of various base metals has also contributed to the decrease in the value of the Australian dollar. The biggest exports of Australia are iron ore and coking coal. Both these elements experienced a high index value on Friday. Yet, it was not sufficient to bring the Australian dollar up and it lost up to 3% in the last week.
The increase in the yields of the US and European bonds along with the strengthening of the USD has proved to be bad for the Australian dollar. The weakness of the Australian dollar can also be contributed to the new bank lending policies of China introduced in October. Economic experts suggest that the Chinese will push the economic activity and this can also result in further weakening of the Australian dollar. The New Zealand dollar also decreased, as there is an increase in demand for the greenback. The NZD/USD pair lost 0.37% to reach 0.7089, which is again the lowest the past one month.
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