Weights for the TWI Notification of Changes

The next update of the weights for the trade-weighted index (TWI) of the Australian dollar will include a small change in methodology. The weights will continue to reflect the importance of Australia's major trading partners, but will now be based on both merchandise and services trade, rather than merchandise trade only. This change takes advantage of country-level services trade data that have been published by the Australian Bureau of Statistics (ABS) over recent years. Otherwise, the methodology is unchanged and the impact is not expected to be large. A description of the current methodology can be found in the October 2002 RBA Bulletin article, ‘Developments in the Trade-weighted Index’. Previous weights will not be revised and the base for the index will remain as May 1970 equal to 100.

The next update of the weights for the TWI will be published on 30 November 2011 and will apply from 1 December 2011. It is expected that updates of the TWI weights in subsequent years will occur in late November or early December, as opposed to 30 September as in previous years.