RBA's attempts to hold down dollar a bust

by Adam Smith23 Jun 2014

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.

COMMENTS

  • by RBA no match 24/06/2014 10:27:13 AM

    The RBA refuses to compete with the major competing economies that are driving their currencies lower to create jobs and economic growth, at the expense of Australia. We are losing industries and talent at a record rate. The US & Europe have a whole raft of programs to actively keep their currencies low, while the RBA sleeps. China and others actively manage their currencies for growth. There is no level playing field in world trade. Thee never was, and never will be. The RBA & FIRB employees are secure in their jobs, and don't seem to care much for the rest of us, or the future. They seem to have no idea on the effort over time to create the major industries in Aust and to establish our farms. Just run them down and sell them off cheap to overseas buyers is the quick fix. It's TREASON.