Commodity Currencies
Commodity currencies, in the context of the forex market, refer to currencies whose value is closely linked to the prices of commodities such as metals, energy resources, and agricultural products. These currencies tend to be from countries that are major exporters of these commodities. The performance of commodity currencies is often influenced by changes in commodity prices and global supply and demand dynamics. The major commodity currencies include: Australian Dollar (AUD): Australia is a significant producer and exporter of commodities such as iron ore, coal, gold, and agricultural products. The value of the Australian dollar is often influenced by changes in global commodity markets; Canadian Dollar (CAD): Canada is a major exporter of crude oil, natural gas, metals (like gold, copper, and silver), and forestry products. The Canadian dollar’s value is closely tied to movements in commodity prices, particularly energy prices; and New Zealand Dollar (NZD): New Zealand exports products like dairy, wool, meat, and timber. Its currency, the New Zealand dollar, is affected by changes in global demand for these commodities.
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