The Aussie dollar at 103 US cents (Dollar sets new post-float high) will be welcomed by Australians shopping online and holidaying overseas but, by making Australia a more expensive holiday destination for international visitors, it’s likely to prolong the slump in Queensland tourism.
Queensland, however, will be propped up by the mining sector and our economy should be firing again by later this year. The largest adverse consequences of our high dollar will be felt by the Victorian manufacturing sector, which will experience reduced exports as its products are now more expensive to overseas buyers.
It’s worth keeping a close eye on the car industry. Knowledgable industry observers have previously commented that Ford is the next Mitsubishi (i.e. the next global car company to pull out of Australia). Recent sales figures for the Falcon would suggest this is possible, and a higher Aussie dollar may force Ford to reassess its commitment to its Australian operations. For more on Ford’s recent troubles, see: