Reserve Bank of Australia
The Exchange Rate and the Reserve Bank's Role in the Foreign Exchange Market
Australia has a floating exchange rate. This page discusses the Australian dollar exchange rate within the context of the Reserve Bank of Australia's monetary policy framework and the role of the Reserve Bank in the foreign exchange market.
About Monetary Policy
The Reserve Bank of Australia is responsible for formulating and implementing monetary policy. Monetary policy decisions involve setting the interest rate on overnight loans in the money market. Other interest rates in the economy are influenced by this interest rate to varying degrees, so that the behaviour of borrowers and lenders in the financial markets is affected by monetary policy (though not only by monetary policy).