Iron ore was limit-down today in China
Dalian exchange iron ore -- the global benchmark -- was halted today after falling 7.3%, the maximum daily drop allowed.
The gain in ore from November through March defied analysts who were warning of major oversupply. The selling began at the begging of April and has accelerated.
The correlation between ore and the Australian dollar sometimes disconnects but it's back in focus and the main driver as UAUD/USD falls below 0.7400 today in the second day of selling.
The other question is what the drop in ore prices says about China.
The answer: Probably nothing. Yes, they've slowed down spending on infrastructure but there is just far too much production in the world and the boom and must from Nov-March probably didn't help.