SYDNEY: The Australian dollar plunged on Tuesday as investors snapped up US dollars after China devalued its currency against the greenback by a record amount.
The People’s Bank of China announces the mid-point against the US dollar for the day’s currency trading each morning. The rate has been remarkably stable since March, but Tuesday’s record 1.9 per cent downwards revision set off a flight to safety.
Westpac senior currency strategist Sean Callow said the Australian dollar was collateral damage as the US dollar shot up.
