The RBA’s attempts to deflate the Australian dollar have failed, a senior economist has claimed.
Perpetual senior economist Matt Sherwood has told Fairfax that the RBA’s campaign to take the heat off the Aussie dollar by holding interest rates at a record low has been a bust. The Australian dollar has spent the past two months testing 94 US cents after trading below 87 US cents five months ago, Fairfax said.
"The RBA's war against the Australian dollar — and its desire to get it lower — has been lost," Sherwood said.
Sherwood said the Australian dollar has stubbornly high due to extremelt low interest rates in other major world economies.
"Indeed, over the past 18 months the bank has been telling us that the Australian dollar is historically high and is at levels that are tightening financial conditions,” Sherwood said.