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Australian dollar falls again

SYDNEY - The Australian dollar plunged 3.7 percent against the greenback Monday after hitting a new five-year low, as the once-soaring unit became the whipping boy of the global financial crisis.

Investors worried that the financial turmoil is deepening are dumping the high-yielding Aussie fast, extending its losses against the strengthening US unit to 38 percent since July, when it threatened parity with the US dollar.

The Australian unit was trading at 0.6150 to the greenback, down more than two US cents from Friday's domestic close of 0.6388 after hitting a five-year low of 0.6060 at the weekend, its weakest point since April 15, 2003.

‘It is carrying some of the weight of this global financial crisis, there's no doubt about that,’ Australian Treasurer Wayne Swan said Monday of the unit's dizzying fall from a high of 0.9849 in mid July.

But even as the dollar sent the prices of imported goods and overseas travel skyrocketing for Australians, Swan said the weaker currency would help exporters and tourism.

‘There is a variety of influences on the dollar, and I wouldn't speculate on those because in these uncertain times that has its own impact,’ Swan told Fairfax Radio Network.

‘(But) if you are in the tourism industry or an exporter this will certainly provide some relief,’ he said.

The Aussie, which before the financial crisis had benefited from the soaring price of commodities that drove Australia's economy and high domestic interest rates, fell sharply against the yen too, fetching 55.10 yen, down from Friday's level of 60.86.

A flight towards the perceived safety of the US unit amid fears of a global recession combined with the commodities-driven nature of the Australian dollar are battering the unit, CommSec chief economist Craig James said.