As Deus Forex Machina reported this morning, the Australian dollar has broken down and it just now hit to a new low for the move:
This seems an ideal moment to check in on the crosses:
As you can see, the Aussie is dropping slowly against the US dollar and euro but also against the Korean won and Brazilian real. The Yen of course is falling like a stone against everything.
The Aussie weakness seems to be going hand-in-glove with a shift in interest rate markets. Bank bill futures are now pricing almost two full rate cuts, one in May, the next in August, which seems fair enough to me:
Then again, previous rate weakness was not enough to trigger currency weakness. The difference may be that implied future distributions for Australian interest rates are falling just as global growth prospects are rising.
A nice combination for currency weakness.