This Analyst Suggests Not Temporarily Seizing Commodity Currencies

DRAWING. Among the currencies linked to commodities, the Australian dollar (AUD) and the Canadian dollar (CAD) have performed quite well this year.

Journalist: Aris Nourjani | Editor: Khomarul Hidayat

KONTAN.CO.ID – JAKARTA. Among the currencies linked to commodities, the Australian dollar (AUD) and the Canadian dollar (CAD) have performed quite well this year.

Lukman Leong, analyst at DCFX Futures, said that commodity currencies such as AUD and CAD are still quite good against other currencies because the country of origin of these currencies is the largest exporter of commodities. energy.

“The AUD is driven by coal. While the CAD is driven by Canada, which is the world’s largest producer and exporter of energy commodities. With high commodity prices, it is supporting their currency,” Lukman told Kontan.co.id, Wednesday (20/ Sept).

Read also : Commodity Currency Movements Affected by Commodity Prices and Recession Fears

According to Lukman, commodity currency is the currency of a country that has large commodity exports relative to GDP and generally the value of the currency will follow commodity prices.

“Although the CAD and AUD currencies are relatively more resilient to USD strengthening compared to GBP and EUR, at the moment I see that now is not the time to invest in the currencies of the raw materials,” Lukman said.

Because, Lukman said, right now there are no major global currencies strengthening against the US dollar.

Lukman said the sentiment supporting the movement in commodity currencies comes from lower inflation so the central bank can focus more on economic growth.

Meanwhile, sentiment that may weaken commodity-linked currencies due to the recession stems from monetary policy tightening.

“On top of that, of course, commodity prices themselves will always depend on other factors such as geopolitics, the shutdown of gas supplies from Russia triggers an increase in coal prices,” he said. Lukman said.

Read also : The strengthening of energy commodity prices should continue

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Robert Butler

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