Forecasts of the value of the Australian dollar are of great importance to importers, exporters, fund managers, and investors. Unfortunately, accurate forecasts are hard to come by. In a survey of 17 economists by the Australian Financial Review (AFR) in December 1999, not one predicted a drop in the value of the dollar at December 2000. The range of forecasts was from US66c to US75c (average US71c). But the Australian dollar did drop – from US65c to US55c.
The economists forecasts did not adapt much as time went on. In forecast updates throughout 2000, the value of the Australian dollar was predicted to rise in six months but instead it continued to fall.
Then, throughout 2003 as the dollar recovered, all economists surveyed by the AFR in four surveys had pessimistic forecasts.
The value of the dollar is influenced by local and international interest rates, by commodity prices, and by speculators. Our models, developed in 2006, aim to capture these factors.
Our forecasts are updated regularly on our Australian Business Environment Dashboard. Access is via user id and password, and costs $100 per year.
More about the Australian Business Environment Dashboard and how to access it.