Australian Dollar Exchange Rates Fall
The Australian dollar has been one of the best performing currencies in the last 12 months, as the Australian Economy appears to have weathered the storm better than any other during the economic downturn. However, in the last few days the Australian currency has made significant losses against a number of currencies. The AUD has lost ground agaisnt the USD, GBP, JPY and EUR on renewed worries about the health of the global economy.
The problems in Greece, and subsequently Europe, have increased concerns that the global recovery is going to be sluggish. This could mean that China may suffer as there will be less demand for their goods, this in turn means that there will be less Chinese demand for Australian raw materials (used to make those goods and build the factories and offices for companies that produce them). As a result of reduced demand for raw materials the Australian Economy would probably suffer.
Couple this with fears of a hung parliament, a big drop in consumer confidence due to rising interest rates and traders moving away from ‘risky currencies like the AUD, and we may finally be seeing the end of the recent surge in Australian Dollar exchange rates.