China supplanting US in dollar influence
China rather than the US is emerging as the global price-setter for commodities, according to new analysis released by HSBC.
The analysis, released this week, looked at what was driving commodity and equity prices and suggested that more and more indicators were pointing to the importance of China in terms of determining the value of the Australian dollar.
“It seems that China, not the US, is the global price-setter for commodities and so in that way it has an indirect impact on the Australian dollar,” the analysis said.
It said it appeared that China was a more influential determinant of Australian dollar value than the US was and suggested that this would only intensify over time.
The release of the analysis came as HSBC revised upwards its Australian dollar forecast suggesting it would be sitting at US86 cents by year-end and rise further to US96 cents by the end of 2010.
AUTHOR
Mike Taylor
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