Whats Trade Weight Index? (1 Viewer)

[Nasonex]

Can someone explain this concept in detail for me?

getting very confused about this

 

[lionking1191]

assuming you're an 08er that explanation above ain't gonna work for you.

it's basically the top 20(?) currencies we trade with and they're weighted according to how much we trade with them. eg. US is the top as we do most of our exchanging with them, but a country like malaysia would be lower down as we don't exchange much with them.

any textbook could obviously give a better answer than that, check it out in the glossary or index.

yep basically all the currencies that must count for at least 90% of total volume of exports/imports

 

[zammitm1]

the Trade Weighted Index (TWI) is an index or measure reflecting the average movement of the value of the Australian dollar against a basket of other currencies of our trading partners, each weighted according to its relative importance. In the base year, the index will equal 100 points. However, if our dollar appreciates, the index will rise above 100 points, while if our dollar depreciates, it will fall below 100 points.