Australian to US Dollar http://www.forexconspiracyreport.com/australian-to-us-dollar/ he rate of exchange of the Australian to US Dollar has been moving in favor of the US dollar. To a degree this is because the US Federal Reserve is tapering its quantitative easing program of bond and US Treasury purchases. This is driving up interest rates in the USA and would tend to reduce the value of the Australian to US dollar. However, a major factor in the value of the AUD is the strength of the Chinese economy as China is a major customer for raw materials as well as finished products from Australia. In general a higher Chinese growth rate and especially the anticipation of a higher Chinese growth rate helps the AUD. A slowing Chinese growth rate hurts the AUD. We have noted that economic change in China may well be positive. To the extent that the Chinese real estate bubble bursts, manufacturing numbers continue to drop or massive amounts of bad loans destroy banks in China the AUD will suffer. Higher Interest Rates in the USA When interest rates go up money will follow. Japan has been stuck with extremely low interest rates for years and investors habitually converted strong Yen to weak dollars and took advantage of high US interest rates. When rates in the US fell these folks simply took their money back home. Now, as rates promise to rise in the USA investment and Forex capital is moving into dollars. The Fed action is hurting currencies around the world as the USD rises in value. This affects the Australian to US dollar relationship as well. However, our primary concern with the Australian to US dollar relationship does not have to do with a transpacific relationship but rather with Australia’s reliance on the Chinese market. The Sino Australian Trade Relationship and the AUD Australia commonly runs a trade excess with China of more than $20 Billion with total exports to China running well over $60 Billion. Both figures are in AUD. A trade excess is obviously good for Australia. Having a large customer for coal, oil, liquefied natural gas and iron ore has helped Australia prosper in good times and has tempered the effects of the recession. However, what happens if the Chinese economy bottoms out? Traders will be wise to avoiding going long for too long on the AUD for the time being. Or traders can use Forex options to hedge risk and still prosper from the ups and downs of the Australian to US dollar.

1. Australian to US Dollar
By
www.ForexConspiracyReport.com

2. The rate of exchange of the Australian to US
Dollar has been moving in favor of the US
dollar.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

3. To a degree this is because the US Federal
Reserve is tapering its quantitative easing
program of bond and US Treasury purchases.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

4. This is driving up interest rates in the USA
and would tend to reduce the value of the
Australian to US dollar.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

5. However, a major factor in the value of the
AUD is the strength of the Chinese economy
as China is a major customer for raw
materials as well as finished products from
Australia.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

6. For more insights into the Australian to US
dollar ratio take a look at the following chart
and read the article.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

7. Year
AUD = 1 USD
Chinese Growth Rate
1999
0.61
7.6%
2000
0.65
8.4%
2001
0.56
8.3%
2002
0.52
9.1%
2003
0.56
10%
2004
0.74
10.1%
2005
0.78
11.3%
2006
0.74
12.7%
2007
0.77
14.2%
2008
0.87
9.6%
2009
0.71
9.2%
2010
0.90
10.4%
2011
1.03
9.3%
2012
1.02
7.8%
2013
1.03
7.7%
2014
0.89
7.4%
http://www.forexconspiracyreport.com/australian-to-us-dollar/

8. Chinese GDP growth rates are courtesy of
the World Bank web site and are updated
through the end of 2012. Figures for 2013
and estimates for 2014 are from private
sources.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

9. Exchange rates are as of the first of each
year and represent the amount in AUD
required to purchase one USD.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

10. Following the numbers we can see that in
general a higher Chinese growth rate and
especially the anticipation of a higher
Chinese growth rate helps the AUD. A
slowing Chinese growth rate hurts the AUD.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

11. We have noted that economic change in
China may well be positive.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

12. To the extent that the Chinese real estate
bubble bursts, manufacturing numbers
continue to drop or massive amounts of bad
loans destroy banks in China the AUD will
suffer.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

13. Higher Interest Rates
in the USA
http://www.forexconspiracyreport.com/australian-to-us-dollar/

14. When interest rates go up money will follow.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

15. Japan has been stuck with extremely low
interest rates for years and investors
habitually converted strong Yen to weak
dollars and took advantage of high US
interest rates.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

16. When rates in the US fell these folks simply
took their money back home.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

17. Now, as rates promise to rise in the USA
investment and Forex capital is moving into
dollars.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

18. The Fed action is hurting currencies around
the world as the USD rises in value.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

19. This affects the Australian to US dollar
relationship as well.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

20. However, our primary concern with the
Australian to US dollar relationship does not
have to do with a transpacific relationship but
rather with Australia’s reliance on the Chinese
market.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

21. The Sino Australian
Trade Relationship
and the AUD
http://www.forexconspiracyreport.com/australian-to-us-dollar/

22. Australia commonly runs a trade excess with
China of more than $20 Billion with total
exports to China running well over $60
Billion.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

23. Both figures are in AUD. A trade excess is
obviously good for Australia.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

24. Having a large customer for coal, oil, liquefied
natural gas and iron ore has helped Australia
prosper in good times and has tempered the
effects of the recession.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

25. However, what happens if the Chinese
economy bottoms out?
http://www.forexconspiracyreport.com/australian-to-us-dollar/

26. Traders will be wise to avoiding going long for
too long on the AUD for the time being.
http://www.forexconspiracyreport.com/australian-to-us-dollar/

27. Or traders can use Forex options to hedge
risk and still prosper from the ups and downs
of the Australian to US dollar.
http://www.forexconspiracyreport.com/australian-to-us-dollar/