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BHP suffers despite falling dollar

Despite commodity price gains on Friday, which saw the price of iron ore rise to US$114.19 per tonne, mining heavyweight BHP Billiton (ASX: BHP) has again been trading in the red over the last two days.

Yesterday, Australia’s largest miners fell like dominos after surging on Friday, whereby companies such as Fortescue Metals Group (ASX: FMG), Rio Tinto (ASX: RIO) and Newcrest Mining (ASX: NCM) all finished in the red. Joining them was BHP, which has fallen a total of 1.3% this week, adding to the pain felt by shareholders this year.

Whilst commodities gained value on Friday, the Australian dollar also fell marginally overnight to trade at US95.11c, which would be considered a good thing for BHP, as its primary customers are all overseas. However, a number of experts have predicted that the fall of the Australian dollar could be over for now, which may have played on the nerves of investors.

Foolish takeaway

The volatility of the industry is taking its toll on investors, whereby any international market news can be enough to shake up the market’s emotions. Until the volatility begins to subside, it is a good idea to remain on the sidelines for this stock.

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Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned in this article.

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