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Internationalising a currency: the case of the Australian dollar

Author

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  • Robert McCauley

Abstract

Asian policymakers are giving consideration to allowing their currencies to be used by non-residents. If policy allows this and a robust fixed income market provides support, the Australian experience indicates that a currency can internationalise fairly quickly, particularly if it offers a yield pickup.

Suggested Citation

  • Robert McCauley, 2006. "Internationalising a currency: the case of the Australian dollar," BIS Quarterly Review, Bank for International Settlements, December.
  • Handle: RePEc:bis:bisqtr:0612f
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    References listed on IDEAS

    as
    1. Mike Wolyncewicz, 2005. "Funding agreements for the Reserve Bank," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 68, September.
    2. John Simon, 2001. "The Decline in Australian Output Volatility," RBA Research Discussion Papers rdp2001-01, Reserve Bank of Australia.
    3. Guy Debelle & Jacob Gyntelberg & Michael Plumb, 2006. "Forward currency markets in Asia: lessons from the Australian experience," BIS Quarterly Review, Bank for International Settlements, September.
    4. Benjamin H Cohen, 2005. "Currency choice in international bond issuance," BIS Quarterly Review, Bank for International Settlements, June.
    5. Robert McCauley & Guorong Jiang, 2004. "Diversifying with Asian local currency bonds," BIS Quarterly Review, Bank for International Settlements, September.
    6. Guonan Ma & Corrinne Ho & Robert N McCauley, 2004. "The markets for non-deliverable forwards in Asian currencies," BIS Quarterly Review, Bank for International Settlements, June.
    7. David Drage & Anella Munro & Cath Sleeman, 2005. "An update on Eurokiwi and Uridashi bonds," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 68, September.
    8. Tro Kortian & James O’Regan, 1996. "Australian Financial Market Volatility: An Exploration of Cross-country and Cross-market Linkages," RBA Research Discussion Papers rdp9609, Reserve Bank of Australia.
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    Citations

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    Cited by:

    1. Ric Battellino & Michael Plumb, 2011. "A generation of an internationalised Australian dollar," BIS Papers chapters,in: Bank for International Settlements (ed.), Currency internationalisation: lessons from the global financial crisis and prospects for the future in Asia and the Pacific, volume 61, pages 202-217 Bank for International Settlements.
    2. John Lipsky, 2012. "Session III: Introductory remarks," BIS Papers chapters,in: Bank for International Settlements (ed.), Financial sector regulation for growth, equity and stability, volume 62, pages 123-124 Bank for International Settlements.
    3. Atchana Waiquamdee, 2011. "Progress towards internationalisation: the Korean and Singaporean experiences - comments on Kim and Suh's paper "Internationalisation of the won" and Luke Goh's paper "Singapore dollar'," BIS Papers chapters,in: Bank for International Settlements (ed.), Currency internationalisation: lessons from the global financial crisis and prospects for the future in Asia and the Pacific, volume 61, pages 172-179 Bank for International Settlements.
    4. YV Reddy, 2012. "Financial sector regulation and macroeconomic policy," BIS Papers chapters,in: Bank for International Settlements (ed.), Financial sector regulation for growth, equity and stability, volume 62, pages 29-37 Bank for International Settlements.
    5. Pavel Trunin & Sergey Narkevich, 2013. "Prospects for the Russian Ruble to Become Regional Reserve Currency," Working Papers 118, Gaidar Institute for Economic Policy, revised 2015.
    6. Tsuyuguchi, Yosuke & Wooldridge, Philip D., 2008. "The evolution of trading activity in Asian foreign exchange markets," Emerging Markets Review, Elsevier, vol. 9(4), pages 231-246, December.
    7. Wang, Jianxin, 2014. "Overnight price discovery and the internationalization of a currency: The case of the Korean won," Pacific-Basin Finance Journal, Elsevier, vol. 29(C), pages 86-95.
    8. Narkevich, Siarhei & Trunin, Pavel, 2013. "Prospects for the Russian Ruble as a Regional Reserve Currency," Published Papers dok2, Russian Presidential Academy of National Economy and Public Administration.
    9. Sergey Narkevich & Pavel Trunin, 2012. "Reserve Currencies: Factors of Evolution and their Role in the World Economy," Research Paper Series, Gaidar Institute for Economic Policy, issue 162P.
    10. Peter B Kenen, 2011. "Currency internationalisation: an overview," BIS Papers chapters,in: Bank for International Settlements (ed.), Currency internationalisation: lessons from the global financial crisis and prospects for the future in Asia and the Pacific, volume 61, pages 9-18 Bank for International Settlements.

    More about this item

    JEL classification:

    • F3 - International Economics - - International Finance
    • G1 - Financial Economics - - General Financial Markets

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