subject: Undertand The Emergence Of Developing Nations And How They Have Changed The Dynamics Foreign Exchange Markets [print this page] Recent developments in the intrinsic value of the currencies are quite interesting and significantly different from our previous experiences. Recent economic crisis has resulted in a movement to risk that appreciated the value of the American dollar against other currencies. This process has started to reverse as trade flows recuperates and Gross domestic product improves in most parts of the world. But a jobless recovery in America, with economic improvement around the world generated mainly by developing nations had resulted in drastic variations in the values of the currency. Regions that have natural resources and raw materials have done well from the rise of China, the increasing consumption from both China and India.
In comparison with period of March June 2009 with June- July 2010, the Kiwi and the Aussi have appreciated respectively 32% and 30% versus the European currency. Farming and natural resources predominatly minerals account for 37.6% and 4.6% of export from Australia. China is Australia's biggest export market at 42.5 billion in 2009.
Other currencies experimenting large gains are the Canadian Dollar, the Colombian Peso, the Brazilian Real and the South African Rand. The Canadians are known for having the 2nd biggest reserves of oil and gas in the world - 179 billion of barrels, and is the number 1 exporter of crude to America (satisfying 22% of the US demand) and the safer, least volatile maker among the other top producers (Mexico, Saudi Arabia and Venezuela). Canada not only has energy but also provides the grain and fertilizer to feed the increasingly wealthy population of the emerging markets Needs that increase faster than the population / GDP growth as a wealthy consumer shifts from grains to meat . The Canadian dollar has appreciated 21% versus the Euro in the mentioned period.
Oil and natural reserves have also helped Brazil. Lately they found an oil reserve that is considered the largest after the Kazakhstan find in 2000. It is estimated at 2-5 billion barrels. In addition to energy, Brazil has increased the productivity and profitability of its farms; lands did not have any agricultural potential 30 years before (El Cerrado) has been changed into giant farms because of the de-acidification of the soil, genetic engineering of Soya and improved ways of production. They are giving the developed nations a real run for their money and even winning some of the battles. Farm production value has increased from 23 billion reais to 108 billion reais (365%) between 1996 and 2006, its exports of beef have multiplied by 10. The Brazil Reais has appreciated 29% versus the Euro in the mentioned period.
Undertand The Emergence Of Developing Nations And How They Have Changed The Dynamics Foreign Exchange Markets
