SBS50: Biggest Stories 1983

In December 1983, Treasurer Paul Keating announced that the Australian dollar would be floated. Removing a fixed exchange rate meant the value of the dollar could automatically adjust in response to how it was trading on the foreign exchange market.

Australian Prime Minister - Mr. Paul Keating (AP-Photo/Russel Mcphedrand) 19.12.1991 Credit: AP

The decision to float means that the speculators will now be speculating against themselves rather than against the Australian Government via the Reserve Bank

Paul Keating

The following Monday, our dollar was officially pushed out to sea.

It was a decision hailed by NSW Premier Neville Wran.

The present step towards deregulation is not only courageous, it’s sensible and it’s slightly adventurous ...And I think Mr Keating and Mr Hawke should be applauded.

Neville Wran

One benefit was the moment the global economy went bad, the dollar could drop in response, giving Australian exports a boost.

It climbed too high during good times, and it had the power to hurt home-grown industries, like car manufacturing and steel-refining during the mining boom.

But overall, a floating dollar has helped make Australia more secure and resistant to international crises, in turn, making us more of a global financial centre.

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