or global downturn, as it did in 2001 and 2008. This morning it is trading at 104.5, having slipped from its post QE3 high of 106.26. What to do? Well, in March, when the dollar touched 108, the RBA started to sell more dollars than usual and talked the currency down. Then on May 1, with the dollar still above 104, it shocked the market with a bigger than expected cut of 50 basis points and followed up with another 25 points in June. The dollar instantly fell to 103.3 on May 1 and then kept falling, bottoming at just below 97 a month later before climbing to 106 in August on the back of speculation about European and US QE programs. Since then the risk-on trade, the interest differential and central bank diversification has kept it above 104. The RBA must cut again in October, and possibly by another 50 basis points to shock the markets once more. It also needs to do a bit more Australian dollar selling than usual, although not enough to trigger suggestions that it's "intervening" in the currency (can't have that!). Certainly the cash rate needs to be significantly lower than it is now by this time next year. In essence it seems that the world's central banks are working hard to debase their currencies as an alternative to a trade war. That may not be the primary intention of their QE and zero interest rate strategies, but it's definitely an intended consequence. The