The Reserve Bank of Australia has ramped up the currency rhetoric in recent weeks, aggressively talking the Aussie dollar down. Earlier in 2013 the bank was dancing around the issue and preferred to refer to the fact that our terms of trade had peaked; this then moved to comments about an “uncomfortably high” Aussie dollar and talk of intervention. On Dec 13 – for the first time – there was a mention of a US85 cent level from Governor Glenn Stevens.
The central bank's timing could be perfect and the market may just help to deliver the RBA what it wants in 2014.
Australia on shaky ground