Reserve Bank of Australia board member Heather Ridout spoke with the Wall Street Journal, said:
- “As we transition to a more diversified economic base, the dollar where it is at the moment is very challenging and it is turbo-charging a very high cost structure in Australia and putting a lot of stress on things”
- If the currency, known as the Aussie, remains strong for an extended period it is likely to be damaging and cause a restructuring of the Australian economy “of quite substantial magnitude”
Ridout said the AUD is likely to weaken when the U.S. finally eases backfrom QE
- “Tapering is a very important development; very important for the [Australian] dollar potentially”
The AUD is down a little, but the article has had negligible impact, with EUR, CHF, GBP and NZD also easing towards pre-Yellen levels from earlier today. Ridout is an ex-head of the Australian Industry Group and serves on the board of metals recycling company Sims Metal … she is pretty much always calling for a weaker AUD.
Central Bank Member Says Strong A$ Will Damage Economy if Sustained
