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Economics

Gillard Dollar Peaking, Tax Proves Aussie Overvalued

Australia’s dollar, this quarter’s best performing major currency, is now the most overvalued.

Purchasing power parity, a measure of the cost of goods relative to other countries, shows the so-called Aussie is 27 percent too expensive, according to data compiled by Bloomberg. The median estimate of strategists and economists is for Australia’s dollar to weaken 6.8 percent by year-end, the biggest forecast decline of 31 currencies tracked by Bloomberg.