What is Australian money called today?

The Australian Dollar: A Comprehensive Overview

The Australian monetary system is centered around the Australian dollar (AUD), the official currency of the Commonwealth of Australia, including its territories of Christmas Island, Cocos (Keeling) Islands, and Norfolk Island. Introduced on February 14, 1966, the Australian dollar replaced the Australian pound, bringing about a significant shift in the nations financial landscape.

Historical Evolution of Australian Currency

Prior to the adoption of the Australian dollar, Australia utilized the Australian pound, pegged to the British pound sterling. However, in the post-World War II era, economic and political factors prompted a reassessment of the currency system. The Bretton Woods Agreement, signed in 1944, established a new international monetary system based on fixed exchange rates, leading to the devaluation of the Australian pound against the US dollar.

In the lead-up to the 1960s, Australia experienced a period of strong economic growth, accompanied by rising inflation and pressure on the Australian pound. To address these challenges, the government decided to introduce a new decimal currency, independent of the British pound. The Australian dollar was born, with one dollar equaling ten shillings in the old currency.

Structure and Characteristics of the Australian Dollar

The Australian dollar is a decimal currency, divided into 100 cents. Banknotes, introduced in 1966, are made of durable polymer, a material resistant to counterfeiting and wear. Polymer banknotes have gained widespread acceptance due to their enhanced security features and extended lifespan compared to traditional paper banknotes.

Australian banknotes come in denominations of $5, $10, $20, $50, and $100, each featuring unique designs and security elements. The $5 note is adorned with an image of Queen Elizabeth II, while the $10 note showcases an Indigenous Australian elder, David Unaipon. The $20 note features an Australian pioneer, Mary Reibey, and the $50 note bears the image of Edith Cowan, the first woman elected to an Australian parliament. The $100 note honors the Australian soprano, Dame Nellie Melba.

Coins in circulation include 5c, 10c, 20c, 50c, $1, and $2 denominations. Australian coins are typically made of aluminum bronze or stainless steel, providing durability and distinctive appearances. The 5c coin features a platypus, the 10c coin depicts a kookaburra, and the 20c coin showcases an echidna. The 50c coin bears the image of the Australian coat of arms, while the $1 coin features a lyrebird. The $2 coin, introduced in 1988 to commemorate the bicentenary of European settlement in Australia, depicts an emu.

Exchange Rates and Global Significance

The Australian dollar is a freely floating currency, meaning its value is determined by market forces of supply and demand. It is widely traded internationally, particularly in the Asia-Pacific region, and is considered a safe haven asset during periods of global economic uncertainty. The Australian dollar is also heavily influenced by the performance of the Australian economy, particularly its mining and agricultural sectors, as well as global commodity prices.

Conclusion

The Australian dollar has served as the backbone of the Australian economy for over half a century. Its decimal structure, polymer banknotes, and distinctive coins have become iconic symbols of the nations financial system. As Australia continues to navigate economic and financial challenges, the Australian dollar remains a resilient and widely recognized currency, reflecting the strength and stability of the Australian economy on the world stage.