$A alltime lowhits new

Source: AAP|Published: Monday October 16, 12:47 PM

The Australian dollar fell to yet another all-time low today, hitting $US0.5260 at 1155 AEDT.

This is seven basis points lower than Friday afternoon's previous low of $US0.5267.

Bank of America trader Harry Kendy said a herd mentality in the market was driving the Australian dollar down, despite the currency having no fundamental or technical problems.

Mr Kendy said further record lows could be on the way throughout the day, as fund managers tried to drag the unit down to cover losses on earlier sales.

There's still a tendency to bring the currency lower, I don't know why, he said.

If I was a fund manager who sold at $US0.5267 cents I'd like to make more money by selling more.

The fact that the market sentiment was focused on a lower Australian dollar meant that it was falling regardless of other factors, Mr Kendy said, creating a self-fulfilling prophecy.

It just doesn't make sense at all, he said.

Everybody's just talking about lower currency, it's just sort of fulfilling itself.

http://www.theage.com.au/breaking/0010/16/A54168-2000Oct16.shtml

-- Martin Thompson (mthom1927@aol.com), October 15, 2000

Answers

Herd mentality is right. I wonder if the same is occurring with the Euro.

-- Chance (fruitloops@hotmail.com), October 15, 2000.