The Australian dollar fell yesterday, but ended the week with gains against the US dollar and the Japanese yen. Signs that the global economy is recovering helped the Australian currency to hold ground even when the Forex market sentiment became negative.
US existing home sales fell a little to 4.75 million in September from the upwardly revised 4.83 million in August, but posted an increase by 11 percent from a year ago. The report stated:
Despite occasional month-to-month setbacks, we’re experiencing a genuine recovery.
Yesterday, a couple of positive reports from China was released, suggesting that the biggest Asian economy continue to grow with astounding speed.The Australian dollar fell yesterday, but ended the week with gains against the US dollar and the Japanese yen. Signs that the global economy is recovering helped the Australian currency to hold ground even when the Forex market sentiment became negative.
The fact that developed economies prefer to keep their interest rates extremely low is also positive for the Australian currency. It drives investor to borrow in that countries and invest in Australian assets, increasing demand for the Aussie. Such strategy is known as carry trade.
AUD/USD fell from 1.0363 to closed at 1.0318 and AUD/JPY was down from 82.14 to 81.30.
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