Thursday, 17 Mar 2011

Aussie Dollar Experiencing Rapid Depreciation

While the Japanese yen and Swiss franc appear in focus this week, many traders have also begun to take note of the shift in value for the Australian dollar (AUD).

The Aussie has lost approximately 11% in value against the Japanese yen, while also shedding near 400 points against the US dollar. Technical traders have noted that the price of the AUD has entered a phase of price deceleration against its primary currency rivals, suggesting a reversal may be imminent.

The news comes after several months of solid appreciation in the Australian dollar versus almost every other currency pair. The strengthening Aussie, however, may have begun gouging Australian exports and was thus due for a correction.

The downturn experienced recently, on the other hand, was more than a correction. Few analysts were anticipating such a shocking plummet and many are wondering what its causes may have been. The AUD appears to have broken a number of support levels and looks to be in free-fall. It appears that only bank interventions from either Japan or Australia will be enough to reverse these effects.