Latin America is a large commodity producer and competitor to Australian mining and agriculture. But why let that worry you when they want to buy your currency? From the AFR:
The Australian dollar’s popularity with investors and offshore central banks shows little sign of slowing, with new data showing increased appetite from emerging markets for AAA-rated assets denominated in the local currency.
The International Monetary Fund’s composition of official foreign exchange reserves data shows advanced and emerging economies added a cumulative $US10 billion of “other” currencies to foreign exchange reserves in the June quarter. Although compositional details are not released, the Australian dollar is thought to make up a significant chunk of the “other” category along with the Canadian dollar and Scandinavian currencies.
…TD Securities’ head of Asia-Pacific research Annette Beacher, just returned from a tour of Latin American central banks, said appetite for the Australian dollar was undiminished.
“The near-consensus theme from all central banks was shifting away from holding euros, using the share to “pay” for holding higher amounts of Australian dollars,” Ms Beacher wrote in a note to clients.
C’mon Aussie (jobs to Brazil), c’mon (jobs to Chile), c’mon (jobs to Peru)…
