There are some currencies known in financial circles as “commodities currencies”. Their fortunes seem to be rising an falling in tandem with prices of raw materials. These are the “other dollars” CAD, AUD and, to a smaller degree, NZD.

These countries are large producers and net exporters of a wide range of physical commodities. Oil and gas, metals, forestry and a myriad of agricultural products are imported from those countries by the rest of the world, especially exploding Asian economies. Growing consumption is followed quickly by rising prices of those materials. That, in turn, pushes currencies in exporting countries to appreciate in value.

Huge run ups in AUD, CAD and NZD over last few years were the direct result of this phenomenon.

Than there is Russia. Since the break up of Soviet Union and virtual collapse of its economy, a lot of changes have taken place. Privatization brought much needed capital and improvement. Obsolete plants were either closed or modernized. Rising commodities prices brought Russia to the top level of world exporters in many, if not most, industrial commodities. (We will omit Russian political situation and it’s impact in this discussion.)