I was admittedly being overly simplistic. It's a three way conversion. The iShares ETFs are domiciled in the US and cross listed to the ASX. So in effect, by buying IEU, you are investing in the US listed version of the iShares Europe ETF. So while IEU only gets direct AUD/USD exposure, the US version get USD/EUR exposure.
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Blackrock Foreign Index ETFs (IEU, IAA etc), page-4
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