### Summary
The Australian dollar has weakened significantly against the US dollar, euro, and British pound due to factors such as the US economy's strength, China's weak economic rebound, and a shift in the link between commodity prices and the Australian dollar.
### Facts
- The Australian dollar has reached its lowest level against the US dollar since the global financial crisis in 2009.
- The dollar has also reached its lowest level against the euro since the global financial crisis.
- The value of the Australian dollar against the pound is at its weakest since the Brexit poll.
- The US dollar's strength and expectations of a higher interest rate have contributed to the Australian dollar's weakness.
- China's weak economic rebound and deflation concerns have also affected the Australian dollar.
- The link between commodity prices and the Australian dollar has become less reliable recently.
- The trajectory of Shanghai's top 300 companies share index may indicate the future of the Australian dollar.
- A weaker Australian dollar benefits export industries and overseas visitors, while importers may face challenges.
- A tumbling dollar could support economic growth through increased exports and reduced imports.
📉 The Australian dollar is at its lowest against major currencies since the global financial crisis.
🇺🇸 The US dollar's strength and expectations of a higher interest rate contribute to the Australian dollar's weakness.
🇨🇳 China's weak economic rebound and deflation concerns affect the Australian dollar.
📉 The link between commodity prices and the Australian dollar has become less reliable.
📈 A weaker Australian dollar benefits export industries and overseas visitors.
### Summary
Food prices are increasing globally due to drought conditions, disrupted grain deliveries, and government policies to protect their own supplies. The rising prices are driven by concerns over the enduring effects of a warming climate on production and the possibility of high food prices becoming embedded in the economy. Supermarket profits have increased, but this does not help mitigate the rising costs for consumers.
### Facts
- Wheat prices spiked and then retraced due to Russian missile strikes on Ukrainian ports and disrupted grain exports.
- Erratic weather is depleting rice harvests in India, leading to a ban on rice exports and increasing the risk of higher global prices.
- Food prices in Australia have remained steep, with dairy and breads/cereals leading the price increases.
- Food prices have risen steeply in the UK and France, while prices in the US have increased at a slower pace.
- High global food prices pose a risk of creating an inflationary spiral and are beyond the influence of central banks.
- Australian supermarkets have increased profit margins during the inflationary period, but deny profiteering.
- While the extent of price rises may not be as bad as last year, there will still be an impact on near-term inflation and consumer purchasing power.
🌾 Wheat prices spiked due to Russian missile strikes on Ukrainian ports and disrupted grain exports
🌦️ Erratic weather is depleting rice harvests in India, leading to a ban on rice exports and increasing the risk of higher global prices
🥛 Food prices in Australia remain steep, with dairy leading the price increases
🌍 Food prices have risen steeply in the UK and France, while prices in the US have increased at a slower pace
💰 High global food prices pose a risk of creating an inflationary spiral and are beyond the influence of central banks
🛒 Australian supermarkets have increased profit margins during the inflationary period but deny profiteering
💸 While the extent of price rises may not be as bad as last year, there will still be an impact on near-term inflation and consumer purchasing power.
Global food commodity prices declined by 2.1 percent in August, driven by falling prices of essential food items excluding rice and sugar, according to the Food and Agriculture Organization of the UN. The decrease was due to reduced prices for vegetable oils, meat, dairy products, and cereals, while sugar prices saw a slight increase.
The Australian dairy industry is facing a significant decline, resulting in record-high prices for dairy products and an increase in the importation of cheaper alternatives. This decrease in milk production is expected to be the lowest in 30 years.
The World Bank has lowered its 2024 economic growth forecast for China, citing challenges in the domestic market including the property crisis and a slow rebound from the re-opening, which could harm commodity demand and prices as China is the largest commodity consumer in the world.
Gold prices decline as the U.S. Congress reaches a short-term deal to avert a government shutdown, leading traders to regain risk appetite and pushing gold to its lowest level since March.
The Australian dollar is experiencing heavy selling pressure and could potentially fall further against the US dollar as global interest rates rise, with economists warning that a significant drop in the Australian dollar could lead to higher inflation.
The World Trade Organization has revised its forecast for global trade growth, halving its estimate due to rising interest rates and various economic challenges, with a particular impact on iron, steel, office equipment, textiles, and clothing. The slowdown in trade has raised concerns about the potential negative impact on living standards worldwide, particularly in poor countries.
