Australian dollar Currency

Overview of Currency

Description

Introduced in 1966, the Australian dollar serves as the official currency of Australia, along with several countries and territories, such as Christmas Island, Cocos Islands, Norfolk Island, Nauru, Tuvalu, and Kiribati. The symbol for the Australian Dollar Currency is $, but variations like A$ or AU$ are also sometimes used to differentiate the Australian Dollar from other dollar-denominated currencies. 

The currency in Australia is also known as the “buck”, “dough”, and “aussie”, and is ranked as the fifth most traded currency in the world. Australia’s central bank, the Reserve Bank of Australia (RBA), is the main bank that is responsible for monetary policy and producing the country’s money supply. It issues AUD notes in five denominations: $5, $10, $20, $50, and $100. The Australian currency is subdivided into 100 cents, and its coins are issued in six denominations: 5c, 10c, 20c, 50c, $1, and $2. 

Economy 

• Australia has a mixed economy, which relies on the service industry, contributing nearly 63% of the total gross domestic product (GDP). 
• In 2020, Australia was ranked as the thirteenth largest national economy by nominal GDP, with the country’s GDP estimated at almost USD1.4 trillion. 
• Australia is rich in natural resources, valued at USD 19.9 trillion in 2019. It is positioned as the 10th wealthiest country in the world in terms of natural resources. The key exports of the country include metal, coal, diamonds, meat, and wool. 
• The country is also famous for having vast gold reserves globally, supplying nearly 14% of the world’s gold demand and 46% of the world’s uranium demand. 
• Australia imports products like computers, machines, telecommunication parts, equipment, petroleum products, and crude oil. 
• The popularity of the AUD currency among traders is influenced by various factors related to geology, geography, and government policy. 
• The AUD/USD pair is one of the most frequently traded in the world. 
• Exchange rates for the Australian currency are often tied to the demand for the country’s natural resources, especially from Asian countries like China and India. Hence, the Australian dollar is also called the commodity currency. 
• In response to the increased demand for notes, the Reserve Bank of Australia raised the cash in circulation from A$83 billion to A$94 billion in 2020.
• The Australian Securities Exchange, situated in Sydney, ranks as the 16th largest stock exchange globally in terms of domestic market capitalization.

History 

• In 1966, the Australian currency replaced the Australian pound at an exchange rate of A£1=A£2. The initial coins introduced included 1 cent, 2 cents, 5 cents, 10 cents, 20 cents, and 50 cents. 
• In the year 1967, Australia moved away from the sterling standard by pegging the Australian dollar to the US dollar, with a rate of 1 AUD=1,12 USD.
•  The Australian Currency was the legal tender of Papua New Guinea until 1975 and the Solomon Islands until 1977. 
• By the year 1983, the AUD became a floating currency.
• In 1988, the country introduced the first notes made of polymer to improve anti-counterfeiting, resulting in being the first country in the world to do it.
• The 1-cent and 2-cent coins were abandoned and were phased out of circulation in 2006.
• Special edition notes and coins were issued by the country to celebrate some national events like the wedding of Charles, Prince of Wales, and Lady Diana Spencer in 1981, and the British Commonwealth Games of 1982. 

Trivia 

• Every Australian coin features Queen Elizabeth II on the Obverse side, while the reverse side displays different images on each coin. 
• At first, the 50-cent coins were made of 80 percent silver, but were discontinued later after a year due to the value of the silver content, which significantly exceeded the face value of the coin. 
• The Royal Australian Mint has produced over 14 billion circulation coins since its opening in 1965. The mint is also able to produce more than 600 million coins annually. 
• Note Printing Australia Limited (NPA), a wholly owned subsidiary of the Reserve Bank of Australia, has manufactured polymer banknotes for various other countries, including Brazil, Chile, Malaysia, Mexico, New Zealand, Northern Ireland, Papua New Guinea, Romania, Singapore, Taiwan, Thailand, and Vietnam.