Exchange Rate Policies
Prior to 1983, Australia maintained a fixed exchange rate. The first peg was between the Australian and British pounds, initially at par, and later at 0.8 GBP (16 shillings sterling). This reflected its historical ties as well as a view about the stability in value of the British pound. From 1946 to 1971, Australia maintained a peg under the Bretton Woods system, a fixed exchange rate system that pegged the U.S. dollar to gold, but the Australian dollar was effectively pegged to sterling until 1967.
With the breakdown of the Bretton Woods system in 1971, Australia converted the traditional peg to a fluctuating rate against the US dollar. In September 1974, Australia valued the dollar against a basket of currencies called the trade weighted index (TWI) in an effort to reduce the fluctuations associated with its tie to the US dollar. The daily TWI valuation was changed in November 1976 to a periodically adjusted valuation.
On 12 December 1983, the Australian Labor government led by Prime Minister Bob Hawke and Treasurer Paul Keating floated the Australian dollar, with the exchange rate reflecting the balance of payments and other market drivers.
Read more about this topic: Australian Dollar
Famous quotes containing the words exchange, rate and/or policies:
“We shall exchange our material thinking for something quite different, and we shall all be kin. We shall all be enfranchised, prohibition will prevail, many wrongs will be righted, vampires and grafters and slackers will be relegated to a class by themselves, stiff necks will limber up, hearts of stone will be changed to hearts of flesh, and little by little we shall begin to understand each other.”
—General Federation Of Women’s Clubs (GFWC)
“Whoever thinks his friend more important than his country, I rate him nowhere.”
—Sophocles (497–406/5 B.C.)
“... [Washington] is always an entertaining spectacle. Look at it now. The present President has the name of Roosevelt, marked facial resemblance to Wilson, and no perceptible aversion, to say the least, to many of the policies of Bryan. The New Deal, which at times seems more like a pack of cards thrown helter skelter, some face up, some face down, and then snatched in a free-for-all by the players, than it does like a regular deal, is going on before our interested, if puzzled eyes.”
—Alice Roosevelt Longworth (1884–1980)