Quotes from Standard Chartered:
- We expect a slowdown in the Australian economy, after the mining investment
peak, to weigh on the currency. As a result of its reliance on mining, the
Australian economy may have developed a classic case of 'Dutch Disease'. This
is where a boom in natural resources creates distortions in the domestic
economy and contributes to a significant appreciation of the real exchange
rate.
- As a result, other sectors have grown increasingly uncompetitive as
labour costs increase while profit margins get squeezed. The risks posed by
this two-speed economy could become more troubling if we see no sustained signs
of a pick-up in non-mining growth in the coming months.
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