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Commodity currencies: The deflation factor

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Commodity currencies: How can they withstand the deflation that spot prices in core commodities are enduring?

Answer: some are not, notably South Africa ( EZA , quote ) and its obvious linkage to

gold, and Russia ( RSX , quote ) with its ties with oil. The ultimate commodity currency, however, has to be the Australian Dollar, and while the last couple days have been worth a -1.2% move, Aussie

tested lows of .97 in May/June last year.

Arguably, things are worse on the core global growth story, even though Europe has

found a baseline support. The move in gold should equal a move to sell the Australian Dollar.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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