The National Australia Bank (NAB) is predicting the Australian dollar will remain very high for the medium term.
NAB Chief Economist Allan Oster told the commodity Outlook conference in Canberra that the Australian economy will continue to be very strong on the back of the booming mining and farm export sectors.
"We have the Australian dollar at about $1.05 (to the US$) over the next six months or so. Then we have it gradually coming back down to about 90 cents," said Oster. "That's on the expectation that commodity prices at some stage have to come down a little bit. We don't expect a crash, but we do expect it will probably come back down 10 percent or so. So we would expect that in the medium term you would probably be looking at something like 90 cents, which is a lot higher than the long-range average, which is around 70 cents."
Reprinted in part from ABC Rural Australia