Australia currency strength?

Question

Dear fellow members, a short question for your thought, aussie dollars had falled to the year low today, what do you think or based on the current global economy downturn, does anyone of you out there can explain to me whether aussie currency will likely to fall further, what makes the currency to fall sharply? i really confused....

Answer 1

Australia's economy is very commodity-based, and when commodity prices are high, it does very well, and the value of its currency shows that.

The current impression is that commodities have been priced abnormally highly and that prices for commodities are falling.  Currencies like the Aussie and Canadian dollar, based on economies that benefit from high commodity prices are taking a hit now, and probably will continue to take a hit until commodity prices stabilize again.