Professor Ross Garnaut, of the University of Melbourne, and one of the architects of the AUD float in 1983, is quoted in an Australian newspaper report today as saying the RBA may have to consider intervening to push down the value of AUD, maybe even following the lead of the Swiss National Bank and put a cap on the currency:
if conventional means fail to cut the dollar’s value and relieve the pressure on other tradeable industries, he told a seminar at the Australian National University, the Reserve should consider following its Swiss counterpart’s example and put a cap on the dollar’s value.
- Garnaut is concerned about a potential recession he sees coming as the mining boom turns to ‘bust’
It seems to me that intervention in AUD is good way off, any thoughts of implementing a SNB-style cap is remote.
