The soaring Australian dollar is acting a natural brake on inflation, with bond investors arguing that the Reserve Bank of Australia should consider how much the appreciating currency will affect economic growth.
The dollar’s leap to a three-year high to just under US71¢ last week is providing a vital pressure valve for the economy, they say, automatically lowering the cost of imported essentials and doing some of the heavy lifting usually reserved for the central bank and its interest rate decisions.
