Dollar drops amid terror fears

 

dollar,silver,coin,money,currencyThe Australian dollar is lower amid fears a Malaysian Airlines flight was shot down in rebel-held east Ukraine in what is being called a “terrorist” attack.

At 0700 AEST on Friday, the local currency was trading at 93.51 US cents, down from 93.71 cents on Thursday.

Flight MH17 was carrying 295 people from Amsterdam to Kuala Lumpur when it crashed overnight.

Haven currencies have jumped while US and European stocks have tumbled amid investor concerns that the crash was a terrorist attack, BK Asset Management MD Kathy Lien said.

“Until it is clear how the crash happened and who is responsible, investors will remain risk averse, which means that safe haven currencies such as the US dollar, Japanese yen and Swiss franc will outperform,” Lien said.

“The fear in the market is that the plane was shot down and the Russians are to blame, which would intensify geopolitical tensions.

“But if the plane was shot down, fingers will be pointed to the Ukraine Separatist Rebellion.

“In response, Russia and the Ukraine will most likely be forced to kill the movement as quickly as possible.”

AAP

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