It is no secret that the only constant in the FOREX market is that there are no constants. At any given moment, everything can change - and it can change quite drastically, at that. This is a market that operates on international frequencies 24/7. There is no room for slowing down in the slightest. And yet, sometimes currencies within the market are forced into a position where they slow, for whatever reason. Currently, one of the biggest reasons is the spread of the coronavirus (yes, really). Believe it or not, coronavirus plays a distinctive role in the value of currencies in the FOREX market.
Currencies like the Australian dollar (i.e. AUD) all operate within the same framework market around the globe, but that does not stop the sometimes inevitable shifts that come with realising that this is a market that is susceptible to the ebbs and flows that come with it. Of course, the value of the Australian dollar - as is the case with any currency in the market - goes through inevitable ebbs and flows as the surrounding market fluctuates. This week, however, the Australian dollar has dropped to its lowest value in over ten years - a direct result of the economic fallout that has come in the wake of the spread of coronavirus.
The Australian share market has only managed to creep up ever so slightly after what can only be described as an unstable few days this week - days in which any gains made up until this point in 2020 were effectively wiped out. While it might seem strange or otherwise unexpected for the coronavirus to so heavily impact currency exchange around the globe - especially the Australian dollar, a currency that belongs to one of the least impacted regions around the globe - the simple fact is that it affects the economy, so of course it affects the dollar value at the same time (the two essentially go hand in hand).
Looking at the value of the Australian dollar this week has showcased the drastic impact that coronavirus is having on various aspects of life as we know it - including, as it turns out, the value of currencies around the globe. While the Australian dollar has begun to rise minutely, there is no telling just how long the coronavirus will continue to impact the globe - and the FOREX market in the process. Only time will tell. In the meantime, investors are watching closely for any and all developments.
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