MEDIA RELEASE No: 2004-12 Date: 30 September 2004 Embargo: For Immediate Release

TRADE-WEIGHTED INDEX

The new weights for the TWI have been compiled. These weights will apply from 1 October 2004 and reflect Australia's two way merchandise trade in 2003/04.

The new and old weights are shown in the table below. The Japanese yen, as has been the case since 1983, has the highest weight, though the importance of the yen in the TWI has declined significantly over the past decade. The weight of the United States dollar has also declined, falling by 1 percentage point last year so that the European euro has replaced it as the currency with the second highest weight. The Chinese renminbi has the fourth highest weight and its weight recorded the largest increase at 1½ percentage points last year. The weight of the Indian rupee also increased noticeably by 1 percentage point. The weight of the UK pound sterling declined by 1 percentage point.

The combined weight of the currencies of the Asia-Pacific countries grew by 1½ per cent. The weights of Europe and North America fell by approximately 1 per cent each. The combined weight of other countries increased marginally.

The new weights continue the trend seen over the last 20 years. The Asia-Pacific region accounts for most of Australia's merchandise trade. In recent years its share of total trade has reversed most of the decline following the Asian financial crisis. China remains the main driver of Australian trade with the region.

The weight of western European countries has remained broadly the same over the past 20 years. The recent rise in the weight of EMU countries has been offset by the fall in the weight of the UK