hsrob on 28 October 2008
The Australia dollar has gone from 98.5 US cents/dollar to 60.5 US cents/dollar in about 3 months. My understanding in this situation is that because Australia has a commodities driven market, fears of a recession mean demand for commodities drops and hence affects currency value. I would assume the same would go for other countries in a similar situation to Australia.
Anyone who knows more about this stuff, feel free to correct me.
