Australia’s Prime Minister Julia Gillard claimed that country’s economy is too dependent on commodities exports, while the domestic spending level remains relatively low. As a result, Australia is vulnerable in the current situation of commodity boom.

Australia’s dollar, the world’s fifth-most traded currency, added 12% versus the greenback in 2010. The pair AUD/USD driven by rising revenues from shipments of coal and iron ore to China has reached in December the $1.0256 level, maximum since it became floated in 1983. Strong Aussie affects Australian manufacturing and tourism industries.

It’s necessary to note that unlike the emerging countries from Brazil to China, Australian authorities refrained from steps to stem currency gains, such as through limits on capital inflows letting the market determine Aussie’s rate. So, the nation’s government doesn’t consider the possibility of conducting interventions to weaken Aussie’s rate.

Analysts at National Australia Bank believe that the performance of Australia’s economy may be weaker than expected. In their view, there’s a risk of the Dutch disease effect when the commodities industry grows driving up the national currency and hurting manufacturing as it happened in the Netherlands in 1970s.

Analysts at TD Securities claim that the performance of Australian dollar was practically unaffected by the Trichet’s comments, New Zealand’s earthquake and the oil crisis. The specialists, however, note that the pair AUD/USD will get chance to reach the post-float maximum at 1.0253 only if the RBA signals the rate hike while the central bank indicated no such intention this week. The mentioned level will act as a resistance for now.