Over the past week or so, all eyes have been fixed on the world's stock markets as the fallout from US President Donald Trump's new tariff regime rattled investors. However, there was another market that was equally shaken by the economic changes that Trump was proposing to the global trade system. That would be currency markets, including our own Australian dollar.

The Australian dollar had been having a pretty rough few months, even before the, er, flour hit the fan. It was only in September last year that one Aussie dollar was buying almost 70 US cents. On the day prior to Trump's 'liberation day', that had fallen to roughly 63 US cents. But only a few days later, the Aussie was at its lowest level since the COVID crash of 2020, testing the territory under US 60 cents.

Following Trump's tariff capitulation this morning, the local currency has rebounded and is back to just under 62 US cents.

Even so, this whole saga has likely reinforced the investing impacts of a dramatic move in our currency and the impacts it can have on ASX shares.

Our dollar is a crucial check-and-balance mechanism in our economy, with many downriver effects stemming from its movements. At a base level, a falling dollar makes imported goods more expensive for Australian consumers. That's because we need more of our dollars to buy goods and services priced in other currencies.

However, a lower dollar also makes our exports cheaper. Foreign buyers have to use less of their own currency to purchase our products. That's why you might hear our floating exchange rate described as an economic 'shock absorber'.

This dynamic extends to ASX shares, of course.

A low Australian dollar: The losers

So today, let's discuss which ASX shares are prime candidates to benefit from a lower Australian dollar and which companies will be hurt by it.

Using the above logic, we can conclude that any company that imports goods into Australia to on-sell to customers is going to take a hit from a lower dollar. This will probably hurt retailers more than any other sector. Shares like JB Hi-Fi Ltd (ASX: JBH), Harvey Norman Holdings Ltd (ASX: HVN), and Wesfarmers Ltd (ASX: WES) all fall into this category.

When the Aussie dollar falls in value, the costs of importing televisions, appliances, clothing, and hardware will likely rise for these companies. As such, they will either need to take the hit to their bottom lines or pass the costs onto their customers.

However, any ASX share that exports goods offshore or else reports earnings in US dollars will likely see a benefit from a lower Aussie dollar.

ASX shares that thrive on a cheap Aussie

One good example is the oil sector. An energy producer like Woodside Energy Group Ltd (ASX: WDS) extracts oil and then sells it on the international market in US dollars. When it brings home its profits in Australian dollar terms, these profits will be higher if the Aussie dollar is lower. That can, in turn, mean higher dividends for ASX investors.

It's a similar story with other mining companies, such as BHP Group Ltd (ASX: BHP), Rio Tinto Ltd (ASX: RIO), Fortescue Ltd (ASX: FMG) and Newmont Corporation (ASX: NEM).

CSL Ltd (ASX: CSL), ANZ Banking Group Ltd (ASX: ANZ) and Macquarie Group Ltd (ASX: MQG) are also potential winners from a lower dollar. These shares derive much of their earnings from offshore markets. Especially compared to their peers.

CSL, for example, has significant operations in the US. Today, these are more valuable in Australian dollar terms than they were last week. Similarly, ANZ's investors might forgive the bank for those unfranked dividends if ANZ's international operations get a currency boost.

As with many things on the markets, a lower Aussie dollar begets both winners and losers. Knowing how currency movements impact the shares in your own stock portfolio is a vital aspect of successful investing here on the ASX.