Aussie under pressure as iron ore prices continue to fall

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Wednesday, Jul 08 2015

There were no major data releases from Australia this morning but the pair continues its downtrend being under pressure due to fall in iron ore prices, global concerns as well as RBA wish for lower exchange rates. Iron ore prices fell to new lows weighing on the Aussie while stress over China’s declining equities market and shrinking economy is also hurting the AUD. The Chinese benchmark iron ore price fell below $US50 a tonne for the first time since April, down to $US49.70.

The price has dropped nearly 16% in just a week. The price of iron ore has plunged below $US50 a tonne in offshore trade as the market rout in China damages confidence in the economy of the world’s largest consumer of the commodity. Global volatility fuelled by China and Greece has been driving the currency’s recent fall from grace, and the same factors also continued to weigh overnight on Australia’s most important commodity, iron ore.

Aussie is currently being traded few points above 0.74 handle. Pair ia likely to find support around 0.7350 level and resistance around 0.7450 area. Later today, in the US session, FOMC Meeting Minutes are scheduled for a release.

More in this category: « Eurogroup waiting for new Greek ESM request UK House Prices increased by 1.7% »

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