With the Fed putting the breaks on cheap money, foreign currencies are depreciating against the U.S. dollar, with noticeable declines in historically stronger Australian and Canadian currency exchange traded funds over one year.

The CurrencyShares Australian Dollar Trust (NYSEArca: FXA) is now down 14.0% and CurrencyShares Canadian Dollar Trust (NYSEArca: FXC) is off 10.1% over the past year.

Countries like Australia and Canada “are rebalancing their economies by encouraging weaker currencies,” Sebastien Galy, an FX strategist for Societe Generale, said in a MarketWatch article.

One U.S. dollar is now trading around 1.11 Canadian dollars from 98 Canadian cents in 2012. [Tumbling Loonie Not Yet Benefiting Big Canada ETF]

Bank of Canada Governor Stephen S. Poloz reiterated his concerns on inflation, which is below target. Consequently, they are now more worried about deflation than inflation.

“Until today, the Bank of Canada had been careful not to openly talk down the loonie,” Chief economist Douglas Porter of BMO Capital Markets said. “They effectively gave sellers the green light.”

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