Budget 2013/14 Northern Territory Economy
Tabled paper 295
Tabled Papers for 12th Assembly 2012 - 2016; Tabled Papers; ParliamentNT
Tabled by David Tollner
Made available by the Legislative Assembly of the Northern Territory under Standing Order 240. Where copyright subsists with a third party it remains with the original owner and permission may be required to reuse the material.
Department of the Treasury and Finance
74 Prices 2013-14 Budget against the euro over the year but appreciated substantially against the Japanese yen (13.6percent). This was due to yen weakness as a result of the Bank of Japans actions to raise inflation through aggressively easing monetary policy (see Chapter 3: External Economic Environment). The strength or weakness of the Australian dollar has an impact on the relative cost of Australia as a tourist destination for international travellers, compared with other destinations. Similarly, the exchange rate for the Australian dollar also affects the relative cost of competing international destinations for Australian travellers. The United Kingdom, United States, Germany and Japan are major source countries for international visitors to Australia (see Chapter 13: Tourism). The decline in international tourist numbers is in part due to the strength of the Australian dollar. TWI: Trade weighted index; AUD: Australian dollar; USD: United States dollar; RHS: right-hand side; LHS: left-hand side Source: RBA 2012 2013f 2014f 2015f 2016f Oil prices (year average)1 US$110 US$107 US$107 US$109 US$111 Exchange rates2 AUD/USD 1.03 1.04 1.04 1.01 1.00 Trade weighted index 77 78 78 76 74 f: forecast; AUD: Australian dollar; USD: United States dollar 1 Calendar year 2 Financial year Note: Oil price forecasts are sourced from BREE. Exchange rate forecasts are sourced from ABARES. Source: ABARES; BREE Commodity Prices Demand for commodities can have a significant impact on the Australian dollar exchange rate, which in turn flows through to consumer prices. A strong Australian dollar, or one that is appreciating at a faster rate than the price of imported goods in the source country currency, tends to limit the impact on inflation through the tradeable components of the CPI. A depreciating Australian dollar tends to make Darwin consumers vulnerable to higher prices from the tradeable components of the Darwin CPI. Chart 6.4: Exchange Rates (monthly average) 40 50 60 70 80 90 100 110 0.4 0.5 0.6 0.7 0.8 0.9 1.0 1.1 02 03 04 05 06 07 08 09 10 11 12 USD (LHS) Yen (RHS) Euro (LHS) TWI (RHS) Year ended June Euro per AUD USD per AUD Yen per AUD TWI Table 6.1: Exchange Rates and Commodity Prices