Monday, January 18, 2010

Commodity Currencies Poised for Growth

Commodity Currencies

Although it's impossible to know the rate of growth and/or strength commodity currencies will grow against the U.S. dollar, it's going to be a good season of time for them as commodity prices are set to increase for some time to come.

When talking of commodity currencies, we're referring to the dollars of Australia, Canada and New Zealand; all countries which rely on commodities as a large part of their economies.

History has shown that for the most part these three currencies move in unison with one another based on how the price of commodities are moving, and so all of them should be a good bet over the next couple of years to strengthen against the U.S. dollar, which continues to collapse in value.

China's seeming resumption of economic domestic growth is a good sign for these three currencies as well, as it implies China is buying up commodities again in preparation for more growth, assuming it's for that purpose and not to protect its own exports and currency primarily, although it definitely entails that.

Commodity Currencies

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