When it’s up, it’s undermining manufacturing, agriculture and tourism and driving away international students; when it’s down, it’s inflating the cost of petrol, travel and imports. The poor old Aussie dollar — today trading at 91.6 US cents — never seems to be popular. We take a look at what the media complain about when the A$ is strong, and what they’re complaining about now it’s dropping in value …
When the Aussie dollar was high:
“A high Australian dollar makes imported goods cheaper and exported goods more expensive to foreign buyers. That makes it more difficult for Australian exporting business to compete overseas and more difficult for local businesses to compete with foreign suppliers.” — News.com.au, August 25, 2011
“Australian farmers turned more pessimistic in the first quarter of the calendar year because of the sustained strength of the Australian dollar. Rabobank Australia says the rural confidence index returned to negative territory during the first three months of the year from positive in the fourth quarter, as more farmers say they expect conditions to deteriorate over the next 12 months compared with those expecting conditions to improve.” — The Australian, March 27, 2013
Get Crikey FREE to your inbox every weekday morning with the Crikey Worm.
“The dollar’s rise has spoilt the party, and the Reserve Bank and Labor have hangovers. Blame the dollar. If you wonder why Labor has won so little credit for its economic management, blame the dollar. If you wonder why Australia has become so uncompetitive in the world, blame the dollar. And if you wonder why, in a mining boom, the Australian economy has slowed so much that unemployment is rising and output growing barely faster than the population, blame the dollar.” — The Canberra Times, June 11, 2013
“The high Australian dollar exchange rate is driving prices down and hurting revenue in spite of strong overall sales, Harvey Norman Holdings chief executive Katie Page has said. ‘There are lots of people shopping,’ Ms Page told a retail conference in Sydney today. ‘It is not about a lack of customers. For a lot of retail businesses, transactions are up but (revenue) is down because of the Australian dollar,’ she said.” — The Australian, June 27, 2012.
“Borrowers are unlikely to get another interest rate cut on Tuesday, partly because the central bank governor is getting his wish — a falling Australian dollar. All but one of the 13 economists surveyed by AAP expect the Reserve Bank of Australia to hold its cash rate on June 4, though most say another rate cut is on the cards later in the year … One of the factors blamed for this has been the high Australian dollar, which has stayed above parity with the US dollar for most of the past two years.” — News.com.au, May 31, 2013
Now the dollar is falling:
“Travellers, drivers, homeowners and online shoppers are facing higher prices as the Australian dollar drops to a 33-month low. Major retailers are expected to lift prices for imported goods to try to claw back some profits after a long cycle of heavy discounts and sales. Market experts are tipping a 10 per cent rise in the cost of imported goods by the end of the year.” — Herald Sun, June 20, 2013
“Falling Australian dollar threatens to push new car prices higher: The bigger issue is that, over the past 12 months, the Australian dollar has fallen by an average of 10 per cent compared with the main foreign currencies imported cars are bought with. Half of all imported vehicles sold in Australia last year came from Europe, Thailand and South Korea.” — News.com.au, June 21, 2013
“Motorists may see petrol prices moving towards $1.70 a litre at peak times in coming months as the dollar weakens and global oil prices rise. Treasurer Chris Bowen maintains the Australian dollar’s decline to US90c will be good for business confidence and manufacturers but analysts warn that households will face a cost squeeze as petrol prices rise sharply over the coming weeks … ‘This is more bad news for a retail sector already struggling against increasingly cautious consumers and the broader economy as it transitions away from the mining boom.” — News.com.au, July 7, 2013
“Three reasons the falling Aussie dollar won’t help retailers: 1. Any respite from the shift to online shopping will be short-lived; 2. It increases production costs; 3. The falling Australian dollar makes it cheaper for international retailers to expand …” — Ninemsn.com.au, June 26, 2013.