Stevens states that RBA ‘Open Minded’ on FX Intervention The local dollar traded as low as 48 U.S. cents in 2001 and as high as $1.10 ten years later. “For most of the floating era, until recently at least, a currency that seemed prone to weakness seemed more frequently a problem than the reverse,” Stevens said yesterday. Banana Republic One of the Aussie’s most famous depreciations came in 1986. As exports collapsed because of weak international commodity prices, then-Treasurer Paul Keating warned the nation risked becoming a “banana republic” if it failed to change. His comments prompted lawmakers to tackle inefficiencies in the economy, encourage innovation and boost productivity, spawning new businesses in education, technology and tourism. “Over the past thirty years, the exchange rate has on occasion been the subject of excitement, concern, even shock,” Stevens said. “It has acted as a shock-absorber, as intended, but it has also served as a disciplining constraint at times. Generally speaking, that was good for us.”
