Strong Aussie dollar falters versus yen

The Australian dollar fell 1.7 per cent to 86.83 US cents this month, the highest fall in more than a year. It had reached 88.71 cents on July 25, the highest it has been since February 1989.
Crucially, the currency plunged 3.3 per cent versus Japan's currency, or from 106.36 yen to 102.81 - its biggest drop in almost six years.
The sharp fall in Australia's dollar was put down to a slump in global stocks, prompting investors to slash so-called carry trades. Investors reaped returns by buying the nation's higher-yielding assets with money borrowed cheaply in Japan, causing Australia's dollar to drop to its weakest in almost a month versus the yen.
"It was the Japanese retail investors saying 'these are cheap'," said Ray Attrill, director of foreign exchange research at Forecast Ltd. "Japanese investors were smart. They took the opportunity to buy at lower levels."