Editing Australian dollar (section)

== Exchange rates ==
=== Exchange rate history ===
[[File:Euro exchange rate to AUD.svg|thumb|right|The cost of one Euro in Australian Dollar.]]
<!-- Editor, please don't change this page every time you hear about a new high. Keep in mind style, and edit guides before you do anything. -->

Prior to 1983, Australia maintained a [[fixed exchange rate]]. The Australian pound was initially at par from 1910 with the British pound or A£1 = UK£1; from 1931 it was devalued to A£1 = 16s 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 at £1 sterling = A£1 5s = A$2.50 = US$2.80. In 1967 Australia did not follow the pound sterling devaluation and remained fixed to the [[U.S. dollar]] at A$1 = US$1.12.

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.<ref>{{cite web |url=http://www.abs.gov.au/ausstats/abs@.nsf/90a12181d877a6a6ca2568b5007b861c/d4a22ad91e0348bfca256fd3007baf93!OpenDocument |title=1350.0 – Australian Economic Indicators, Mar 1998 |publisher=[[Australian Bureau of Statistics]] |date=8 December 2006 |access-date=19 April 2011 |archive-date=16 October 2015 |archive-url=https://web.archive.org/web/20151016030017/http://www.abs.gov.au/ausstats/abs@.nsf/90a12181d877a6a6ca2568b5007b861c/d4a22ad91e0348bfca256fd3007baf93!OpenDocument |url-status=live }}</ref> The daily TWI valuation was changed in November 1976 to a periodically adjusted valuation.

The highest valuation of the Australian dollar relative to the U.S. dollar was during the period of the peg to the U.S. dollar.  On 9 September 1973, the peg was adjusted to US$1.4875, the fluctuation limits being changed to US$1.485–US$1.490;<ref>{{cite book |title = World Currency Yearbook, 1984 |year=1985 |isbn=0-917645-00-6 |page=75 |editor-first = Philip P. |editor-last = Cowitt |publisher =International Currency Analysis }}</ref> on both 7 December 1973 and 10 December 1973, the noon buying rate in New York City for cable transfers payable in foreign currencies reached its highest point of 1.4885 U.S. dollars to one dollar.<ref>{{cite web |title = U.S. / Australia Foreign Exchange Rate |publisher = Federal Reserve Bank of St. Louis |url = http://research.stlouisfed.org/fred2/data/DEXUSAL.txt |access-date = 3 January 2020 |archive-date = 2 January 2016 |archive-url = https://web.archive.org/web/20160102151628/https://research.stlouisfed.org/fred2/data/DEXUSAL.txt |url-status = live }}</ref>

[[File:ABC Dollar Float.ogv|thumb|1983 [[Australian Broadcasting Corporation|ABC]] news report on the first day of trading with a floating dollar.]]

In December 1983, the [[Australian Labor Party|Australian Labor]] [[government of Australia|government]] led by [[Prime Minister of Australia|Prime Minister]] [[Bob Hawke]] and [[Treasurer of Australia|Treasurer]] [[Paul Keating]] [[Floating exchange rate|floated]] the dollar, with the exchange rate reflecting the [[balance of payments]] as well as supply and demand on international money markets. The decision was made on 8 December 1983 and announced on 9 December 1983.<ref>{{cite news |title = 20 years since Aussie dollar floated |url = http://www.abc.net.au/am/content/2003/s1005317.htm |access-date=14 October 2010 |publisher=[[Australian Broadcasting Corporation]] |date=8 December 2003 |archive-url=https://web.archive.org/web/20101011022103/http://www.abc.net.au/am/content/2003/s1005317.htm |archive-date=11 October 2010 |url-status=live}}</ref>

In the two decades that followed, its highest value relative to the US dollar was $0.881 in December 1988. The lowest ever value of the dollar after it was floated was 47.75 US cents in April 2001.<ref>{{cite news |title=Global risk weighs on Howard's agenda |url=http://edition.cnn.com/2001/BUSINESS/asia/11/12/aust.economy.biz/ |access-date=14 October 2010 |publisher=[[CNN]] |date=12 November 2001 |archive-date=15 May 2011 |archive-url=https://web.archive.org/web/20110515140207/http://edition.cnn.com/2001/BUSINESS/asia/11/12/aust.economy.biz/ |url-status=live }}</ref> It returned to above 96 US cents in June 2008,<ref>{{cite news |title=Dollar Falls Before RBA Meeting: New Zealand's Drops |url=https://www.bloomberg.com/apps/news?pid=newsarchive&sid=aQV4HwdZoDek |access-date=14 October 2010 |publisher=[[Bloomberg L.P.|Bloomberg]] |date=30 June 2008 |archive-date=11 May 2011 |archive-url=https://web.archive.org/web/20110511042749/http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aQV4HwdZoDek |url-status=live }}</ref> and reached 98.49 later that year. Although the value of the dollar fell significantly from this high towards the end of 2008, it gradually recovered in 2009 to 94 US cents.

On 15 October 2010, the dollar reached parity with the US dollar for the first time since becoming a freely traded currency, trading above US$1 for a few seconds.<ref>{{Cite news |title=Dollar hits parity vs US dollar |url=https://www.reuters.com/article/idUSN1518042820101015 |access-date=15 October 2010 |work=[[Reuters]] |date=15 October 2010 |archive-url=https://web.archive.org/web/20101018073348/https://www.reuters.com/article/idUSN1518042820101015 |archive-date=18 October 2010 |url-status=live}}</ref> The currency then traded above parity for a sustained period of several days in November, and fluctuated around that mark into 2011.<ref>{{cite news |title = Dollar hits new post-float high after US central bank move |url=http://www.theaustralian.com.au/business/markets/australian-dollar-hits-new-post-float-high-after-us-central-bank-move/story-e6frg91o-1225947591487 |newspaper=[[The Australian]] |access-date=25 January 2011 |first=Bradley |last=Davis |date=4 November 2010 |archive-url=https://web.archive.org/web/20110122115604/http://www.theaustralian.com.au/business/markets/australian-dollar-hits-new-post-float-high-after-us-central-bank-move/story-e6frg91o-1225947591487 |archive-date=22 January 2011 |url-status=live}}</ref> On 27 July 2011, the dollar hit a record high since floating, at $1.1080 against the US dollar.<ref>{{Cite news |url = http://www.rttnews.com/ArticleView.aspx?Id=1611446 |access-date = 2 May 2011 |title = AUD/USD Slides After Topping 1.10 Level – Westpac |archive-date = 14 January 2023 |archive-url = https://web.archive.org/web/20230114143247/https://www.rttnews.com/story.aspx?Id=1611446 |url-status = live }}</ref> Some commentators speculated that its high value that year was related to [[European debt crisis|Europe's sovereign debt crisis]], and Australia's strong ties with material importers in Asia and in particular [[China]].<ref>{{Cite web |url=http://www.skynews.com.au/businessnews/article.aspx?id=594335 |title=Sky News: Aussie dollar hits new highs |publisher=[[Sky News]] |date=28 March 2011 |access-date=19 April 2011 |archive-url=https://web.archive.org/web/20110728022926/http://www.skynews.com.au/businessnews/article.aspx?id=594335 |archive-date=28 July 2011 |url-status=dead}}</ref>

Since the end of China's large-scale purchases of Australian commodities in 2013, however, the Australian dollar's value versus the US dollar has since plunged to $0.88 as of end-2013, and to as low as $0.57 in March 2020. As of 2024, it has traded at a range of $0.63 to $0.68.

=== Determinants of value ===
In 2016, the Australian dollar was the fifth most traded currency in world [[foreign exchange market]]s, accounting for 6.9% of the world's daily share (down from 8.6% in 2013)<ref>{{cite web |url = http://www.businessinsider.com/the-most-traded-currencies-in-2016-2016-12 |title = Here are the most traded currencies in 2016 |website = Business Insider |first = Jeff |last = Desjardins |date = 29 December 2016 |access-date = 30 June 2017 |archive-date = 7 July 2017 |archive-url = https://web.archive.org/web/20170707135916/http://www.businessinsider.com/the-most-traded-currencies-in-2016-2016-12 |url-status = live }}</ref> behind the [[United States dollar]], the [[euro]], the [[Japanese yen]] and the [[pound sterling]].

The Australian dollar is popular with currency traders, because of the comparatively high interest rates in Australia, the relative freedom of the foreign exchange market from government intervention, the general stability of [[Economy of Australia|Australia's economy]] and political system, and the prevailing view that the Australian dollar offers diversification benefits in a portfolio containing the major world currencies, especially because of its greater exposure to Asian economies and the commodities cycle.<ref name="SMH1" />

Economists posit that commodity prices are the dominant driver of the Australian dollar, and this means changes in exchange rates of the Australian dollar occur in ways opposite to many other currencies.<ref>{{cite web |url = http://www.westpac.com.au/docs/pdf/aw/economics-research/MarketInsights.pdf |publisher=Westpac |title=Westpac Market Insights March 2011 |page=4 |access-date=8 April 2011 |archive-url = https://web.archive.org/web/20110307030949/https://www.westpac.com.au/docs/pdf/aw/economics-research/MarketInsights.pdf |archive-date=7 March 2011 |url-status=dead}}</ref> For decades, Australia's balance of trade has depended primarily upon commodity exports such as minerals and agricultural products. This means the Australian dollar varies significantly during the business cycle, rallying during global booms as Australia exports raw materials, and falling during recessions as mineral prices slump or when domestic spending overshadows the export earnings outlook. This movement is in the opposite direction to other reserve currencies, which tend to be stronger during market slumps as traders move value from falling stocks into cash.

The Australian dollar is a [[reserve currency]] and one of the most traded currencies in the world.<ref name="SMH1">{{cite news |url=https://www.smh.com.au/business/aussie-now-fifth-mosttraded-currency-20100901-14nma.html |title=Aussie now fifth most traded currency |newspaper=[[The Sydney Morning Herald]] |date=2 September 2010 |access-date=19 April 2011 |last=Yeates |first=Clancy |archive-date=5 April 2011 |archive-url=https://web.archive.org/web/20110405073729/http://www.smh.com.au/business/aussie-now-fifth-mosttraded-currency-20100901-14nma.html |url-status=live }}</ref> Other factors in its popularity include a relative lack of central bank intervention, and general stability of the Australian economy and government.<ref>{{cite web |url=http://www.safehaven.com/article/4608/analyzing-the-australian-dollar-up-down-and-under |title=Analyzing the Dollar – Up, Down, and Under |first=Gary |last=Dorsch |date=14 February 2006 |website=SafeHaven.com |access-date=8 April 2011 |archive-date=31 October 2010 |archive-url=https://web.archive.org/web/20101031201958/http://www.safehaven.com/article/4608/analyzing-the-australian-dollar-up-down-and-under |url-status=live }}</ref> In January 2011 at the [[World Economic Forum]] in [[Davos]], [[Switzerland]], [[Alexey Ulyukaev]] announced that the [[Central Bank of Russia]] would begin keeping Australian dollar reserves.<ref>{{cite news |url=http://en.ria.ru/business/20120126/170960429.html |title=Russia to Keep Dollar Reserves From February |date=26 January 2012 |publisher=[[RIA Novosti]] |access-date=27 January 2012 |location=[[Davos]], [[Switzerland]] |archive-date=12 June 2012 |archive-url=https://web.archive.org/web/20120612135834/http://en.ria.ru/business/20120126/170960429.html |url-status=live }}</ref>

{{Most traded currencies}}

=== Current exchange rates ===
{{Clear}}
{{Exchange Rate|AUD|NZD}}