CurrencyShares Australian Dollar Trust (NYSEArca: FXA) is down about 6% the past month with noted investors George Soros and Stanley Druckenmiller turning bearish on the commodity-driven currency.
“We think the Australian dollar will come down and will come down hard,” Druckenmiller said at last week’s Sohn Investment Conference, Bloomberg reported. “It’s expensive.”
Druckenmiller earned $1 billion for Soros as his chief strategist by betting against the British pound in the early 1990s, one of the most famous currency trades in history.
Reports have also surfaced recently that Soros has a $1 billion short bet against the Aussie dollar.
Earlier this month, the Reserve Bank of Australia lowered the official cash rate to 2.75%, the lowest level in a half-century. [Australian Dollar Sinks on Rate Cut]
Druckenmiller said he expected the Australian central bank to lower interest rates even further, which will weigh on the value of the country’s currency, according to WSJ.com’s MoneyBeat.