AUD - Australian Dollar

The Australian dollar (AUD) is the official currency of the Commonwealth of Australia, along with its territories (including Christmas Island) and several independent states (such as Tuvalu and Nauru). The dollar decimal currency system replaced the Australian pound (subdivided into shillings and cents) in 1966, when the dollar was originally termed the “royal.”

The Australian dollar, like the United States dollar, is divided into one hundred cents. However, Australian currency has the unusual feature of lacking coins valuing one cent. The smallest coin denomination is five cents, and all transactions in Australia are rounded up or down to the nearest five cents in order to accommodate this.

Prior to 1991, one and two cent coins were in use, however they are now out of circulation. Like fellow former British colony Canada, Australia’s currency depicts Queen Elizabeth II. All Australian coins have a portrait of the queen.

The Australian dollar also has one dollar and two dollar coins. Many of the nation’s coins also show off the country’s unique fauna: a frilled lizard is displayed on the two cent coin, an echidna on the five cent, and a platypus on the twenty cent piece.

Unlike U.S. banknotes, which are all the same size, Australia’s banknotes come in a variety of sizes. This feature assists the visually impaired in distinguishing the bills. The bills are also color-coded: pink for five dollar bills, blue for ten dollar bills, red for twenty dollar bills, yellow for fifty dollar bills, and green for one hundred dollar bills.

For security, the notes are made of polymer instead of paper, and include a transparent window with a portrait of Captain James Cook (who was the first European to make contact with Australia in 1770). Polymer banknotes, besides being more difficult to counterfeit, are also more durable than their paper counterparts.

Paper banknotes are vulnerable to microbes and humidity which polymer bills are resilient to. Australia introduced the polymer banknotes in 1988, becoming the first nation to do so. Since then, Brunei, Bermuda, New Zealand, Papua New Guinea, Nicaragua, Romania, and Vietnam have switched to using polymer banknotes exclusively.

The Australian dollar is one of the most commonly traded currencies, because its value tends to change in different ways than the currencies of other nations. It is also attractive because of the high interest rates offered historically. The factors combine to make it the fifth most traded currency, behind the Euro and British pound, among other currencies.