i intend to know why AUD is dropping below 1continuously against USD…and how much time it wil take to go back??
AUD/USD below parity is not unprecedented.
It was around 0.48 in April 2001
im a noob but…
australian government promised to return budget to surplus and last week came out and said it was at an 18bn deficit, also reserve bank cut interest rates to an all time low the week prior (still high by world standards but an unnexpected low in australia)
commodity prices have dropped in the last year and because the australian economy relies quite heavily on commodity exports especially iron ore this has made quite an impact.
theres a relatively high likelihood of further rate cuts later in the year, and from what ive read the aussie has been overvalued for years and im not personally expecting it to return to parity, at least not in any long term sense.
thats my 2 very noobish cents
A break below parity is nothing new for this currency pair. There is a great support level just below 0.9700 and I think it will grind higher from there to test parity again.
thanks for feedback!