Essays on Negative and Positive Impacts on the Australian Economy Assignment

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The paper "Negative and Positive Impacts on the Australian Economy" is an outstanding example of a micro and macroeconomic assignment. The article by collect (2014) describes the question in most Australians’ minds. The article creates an impression that Australians (especially those interested in foreign travel), do not know whether to exchange their Australian dollars or hold on with the hope that their domestic currency will stabilise against other major currencies. The articles go ahead to explain the departure from the norm where most foreign exchange conversions are conducted right before the holiday seasons in June and December.

In an attempt to lock the value of the Australian dollars, Collett (2014) explains how Australians are rushing to purchase foreign currency, and using travel cards to ensure that they do not lose their money’ s worth. The article further indicates how travel cards serve the convenience of their users by accommodating up to 10 different currencies, and how such cards provide a convenient way for Australian users to lock the exchange rates. Collett (2014) also notes that the cards’ costs vary. The travel cards are different from credit cards in that the latter applies the prevailing exchange rates at the time of the transaction. Collett (2014) also observes that analysts did not (at the time of writing the article) expect the Australian dollar to recoup its losses against the US dollar and the sterling pound.

The analysts’ opinions were based on the relative interest rates in Australia. The article creates the impression that Australian interest rates were lower than those of other (comparable) countries, hence the weakening Australian dollar. The article relies on inputs from analysts such as AMP Capital Investors’ chief economist, Dr.

Shane Oliver. In the article, Oliver offers several projections including the possibility that the Australian dollar would exchange at US$ 0.88 for the remaining part of 2014. He however predicted that the rates would fall by mid-2015. Oliver further held the opinion that the Australian dollar would hold steady against the sterling pound.

References

Collett, J 2014, ‘Travellers rush to exchange their Australian currency’, The Age-Money, 2 November, viewed 14 March 2015, .

Garrett, G 2013, ‘Reasons why we should expect a lower Australian dollar’, The Conversation, 21 June, viewed 14 March 2015, .

Reserve Bank of Australia (RBA) 2015, ‘The exchange rate and the reserve bank’s role in the foreign exchange market’, viewed 14 March 2015, .

Stevens, G & Jericho, G 2014, ‘Stimulating Australia: why lower interest rates may not be the answer’, The Guardian, 21 August, viewed 14 March 2015, .

Woodington, M 2013, ‘Pros and cons of a falling Australian dollar’, Commonwealth Bank, 26 June, viewed 14 March 2015, .

X-Rates 2015, ‘US Dollar per 1.00 Australian Dollar monthly average’, viewed 14 March 2015, .

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