The Australian Dollar has declined after reaching 18-year highs against the U.S. Dollar on Wednesday as investors experience a bout of risk aversion and lower commodity prices. The Aussie Dollar also fell against the Japanese Yen against unwinding carry trades. TD Securities senior currency and fixed income strategist Joshua Williamson commented that a move away from carry trade positions was adding to a sell off of the Aussie Dollar. ''There's been some comments and rumours that the Japanese government is less happy with the weak yen and what that means is that's a possible risk for carry trades down the track,'' Mr Williamson said.''In terms of if they want a stronger yen, that might actually pare back a bit of demand for the carry trade.'' A decrease in industrial metals prices have also pulled down the Australian Dollar. The Australian economy has been experiencing a commodity boom during the past few years.
In the foreign-exchange, the Australian Dollar traded at 84.56 U.S. cents compared to Tuesday's trade of 84.72 U.S cents. The Australian Dollar also declined to 104.03 Japanese Yen, way below the 16-year high of 105.35 Yen last friday.
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