Australian dollar falls with iron-ore prices
SAN FRANCISCO (MarketWatch) -- The Australian dollar declined on Thursday toward its lowest level in almost a month versus its U.S. counterpart, as the price of iron ore -- one of Australia's key exports -- continues to fall.
The Aussie (AUDUSD) fell for a fifth session, to $1.0295, down from $1.0356 in late North American trading on Wednesday.
The price for spot iron ore, a key Australian export, has tumbled by 37% in just under six months to around $90.30 a ton.
"The decrease in demand for industrial metals, especially iron ore because it's one of the country's main exports, is something that can continue," said Eric Viloria, senior currency strategist at Forex.com. "The Aussie could see more weakness."
On a technical basis, the Australian currency could fall to around $1.01 in the near term, he said.
The drop in ore prices had accelerated in recent weeks, with analysts tying the drop to slower Chinese steel production and better Australian weather, which extended the iron-ore production period into the monsoon season.
"Press coverage of the continuing decline in iron-ore prices turned increasingly pessimistic," said Chris Walker, strategist at UBS.
The Aussie has fallen about 1% this week alone, and is headed toward a 1.9% decline versus the greenback for August.