Australian Dollar exchange rate falling against both the US dollar and Pound

Hi all

The Australian Dollar is coming under further selling Wall Street tumbles after the Lehman Brothers news yesterday. The Australian Dollar to US Dollar exchange rate was trading below 0.8000 at 0.7850 which is music to the ears of Australian Exporters but will only push up prices further and help fuel inflation which the Reserve Bank and Australian Government are very concerned with.

Australian Prime Minister Kevin Rudd tried to boost confidence yesterday saying that the govt is in talks with the RBA regarding the Wall St crisis. Adds that the global crisis has a "long way to run yet." But the words where not heard by foreign exchange traders who still continue to sell the dollar.

Personally i can see the Australian Dollar exchange rate falling against both the US dollar and Pound to the 0.7350 and 2.3500 level in a very quick time as may FX traders would be sitting on large profits or get out of old losing positions.

Be very cautious with the Australian dollar - it has been know to bite back as i have found out personally many times

Bye for Now

IMS Foreign Exchange

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