Now, the terms of trade are falling, reversing part, though so far only part, of that earlier gain. I would like to make two points, however, about those terms of trade swings. The first is that, in earlier episodes such as in the early 1950s, and the mid and late 1970s, very large terms of trade movements seriously destabilised the economy.
On this occasion, there have been plenty of adjustment challenges – generally coming under the heading of the so-called “two speed economy”, where the resource-intensive regions and industries grew quickly and others slowed.