AUD receiving commodity support - AmpGFX

Greg Gibbs, Director at Amplifying Global FX Capital, suggests that the Australian coal producers, especially the steel-making (coking) variety, have benefited from production curbs in China but the outlook is unclear with reports that China is easing those curbs.

Key Quotes

“Chinese industrial commodity prices have continued to firm despite the steady drumbeat of stories highlighting concerns over its financial sector stability, renewed efforts to control credit growth and the housing market (after both picked up this year and boosted demand for steel).

However, it is often better to follow the price signals, and consistently strong commodity markets in China are providing support for the AUD.

Coking coal prices have surged by around 180% this year.  The first Japanese steelmaker contract agreement with an Australian coking coal exporter set the Q4 price at $200, up from $92.50 in Q3, at a high since 2012.

Iron ore prices have also firmed over the last month.  They are down from their peak for the year in August, but are up 46% this year.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these securities. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Forex involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.