Australia stands out as one really fast growing trade market. We can easily notice that if we consider the year 2009, when the country showed a GDP of 1025 billion dollars, which actually makes of for 1.64% of the entire world’s economy. RBA (Reserve Bank of Australia) is the authority that is responsible for Forex Regulations. The board members will meet every month in the first Tuesday. There are no meetings in January. This basically means that 11 times per year they are going to meet in order to roll policies that will ensure stable and low inflation, payment system efficiency and financial stability.
At the moment Australia has no big debts, climbing from a 2.5 billion dollars debt in 2008. RBA tries to make sure that the noticed deficits are constantly decreased.
Australian Forex Regulatory Authority Functioning
RBA shows a special Domestic Market Division. It has the main job of keeping cash rate close to the bank’s operating target values. It is here that rates charged for financial institution loans are dictated by cash rates. As soon as we see the market being volatile or we see exchange rates turning inconsistent with economic fundamentals, RBA joins in the market. They set up a TWI to function on. TWI will be used to denote Australian dollar weighted average in a comparison with trade partners, mostly Japan, US and China.
The index levels are going to be refreshed daily at 9 AM, noon and 4 PM. Through monitoring USD index and TWI, RBA manages to maintain stability in different market conditions.
Australia’s Forex Regulatory Authority – Affecting Factors
You might not have known but Australia is currently the 3rd largest gold producer in the world. Due to this fact whenever commodities increase in price we also see the Australian dollar growing. This does not happen though due to the fact that the economy is debt ridden.
RBA increased the cash rate up to 4.5% in 2010 because of a need to counter European market fluctuation. RBA is currently trying to achieve peaks noticed in 2008 as there are many raw goods that are needed in Asia.