Country Report Australia October 1996 Main report

Foreign trade & payments: Australian dollar remains firm

The Australian dollar dipped in response to a cut in official interest rates at the end of July, but recovered the ground lost, to hover around A$1.27-1.28:US$1, during August. During early September the exchange rate firmed to over A$1.25:US$1 for the first time in three months. This reflected increased offshore confidence in Australia after the federal government budget and a growing belief that Australian interest rates will not be cut again soon. Enthusiasm for the currency has moderated slightly in recent weeks.

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