AUDCAD (AUDCAD^)

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Pairing – The amount of Canadian dollars (CAD) that one can buy for every Australian dollar (AUS).

Position

AUD – World’s fifth most traded currency

CAD - World’s sixth most traded currency

Important Factors

• Daily news – Due to the size of both Canada and Australia, markets will react strongly to news of the economic situation of each country on a daily basis.
• Macroeconomic developments – Macroeconomic developments in both countries can have global repercussions, resulting in investor fears.
• Economic policy -  As both AUD and CAD are large currencies in terms of the Forex market, economic policy in both countries and relative strength amongst international markets can have a severe effect on the pairing
• Commodities – Canada produces various global commodities in abundance, including timber, and a strong presence in the oil and natural gas markets. Australia on the other hand, has natural resources in abundance, including gold, iron, aluminium, and coal, as well as agricultural exports including beef, wool, and wheat. As a result, activities in these sectors can have a direct bearing on the two economies. Gold is probably the most important commodity when it comes to having an effect on this currency pairing.
• Imports – Alongside its large export market, Australia also relies heavily on imports due to its geographical location meaning domestic production of certain essential products is impossible. This can lead to trading deficits that can cause negative movement for the AUD in Forex markets.