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The current week is on track to record its steepest decline since May 2022 when the Reserve Bank initiated its series of interest rate hikes.
Oil prices surged following a US-Israel offensive against Iran, which led Iran’s Revolutionary Guard to attempt a blockade of the Strait of Hormuz earlier this week.
This strategic strait, positioned just south of Iran, serves as a critical passageway for transporting crude oil from major producers like Saudi Arabia and Kuwait to global markets.
Geopolitical tensions in the Gulf have rapidly impacted the global energy landscape, as the strait’s closure precipitates significant disruptions in oil production and distribution.
The Australian dollar experienced a one percent decline, briefly falling below 70 US cents, and as of 11 am (AEDT), it has marginally risen to just over 70 US cents against the US dollar.
The Australian dollar also dipped by one per cent, and at one point dipped under 70 US cents. As of 11am (AEDT), it is buying a tick over 70 cents against the Greenback.
A 1.5 per cent plunge would mark the dollar’s biggest drop since October last year.
Head of FX strategy at National Australia Bank Ray Attrill told the Australian Financial Review the scale of the fall is “relatively modest”.
“The Aussie is showing a degree of resilience,” he said.
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