Posted May 02, 2018 12:00:08 The Australian dollar has gone up in value against the U.S. dollar.
That has caused concern in the market for Australian exporters, which relies on U.A.E. imports for nearly a third of its export revenue.
Key points: Australia’s dollar index rose to its highest level since the start of the year as the Federal Reserve raised interest ratesThe dollar is expected to weaken further against the greenback as the U,S.
and other nations take actionThe market has been buoyed by signs that China is gearing up for an expansionary policy which will help it push down the value of its currency against the dollar.
But some exporters are taking note of the move, and are taking a hit in their prices.
“We’re starting to see some price increases,” said Craig Evans, head of commodities at Deloitte Australia.
Australia’s largest exporter, the Australian Wholesale Council, has warned its market could be in for a major shock as it tries to stay ahead of the curve on the dollar’s strength.
Its price index is the most-watched gauge of global commodity prices and the biggest indicator of the outlook for Australia’s economy.
The index rose 1.5 per cent to 6,632.86 cents USd last week, the biggest increase since November.
Analysts said the index is still well below the levels of the early 2000s, when the global economy was in its infancy.
However, that may be changing as the global economic outlook improves, the council said.
While the economy is slowly recovering from the Great Recession, it is still a work in progress and there is much more to be done.
We’re still on the road to recovery, said Mr Evans.
If we get caught out and the world is looking for a quick return to some sort of economic recovery, then we may see price increases as well.
“Market watchers are concerned about a possible rise in U.K. interest rates, which could put pressure on the Australian dollar.
The Bank of England will hold a rate meeting next week and if the U