The Australian dollar is one of the most traded currencies in the world. AUD/USD of 0.70 means one Australian dollar buys 70 US cents.
The trade-weighted index measures it against a basket of trading partners' currencies, which matters more for the economy than the US dollar rate alone.
Why it matters
The dollar tends to rise when prices for Australia's exports (iron ore, coal, gas) rise, when Australian rates are high relative to US rates, and when investors are confident. It tends to fall in global sell-offs, which cushions Australian investors holding overseas assets.
A lower dollar raises the Australian-dollar value of overseas shares and exporters' earnings, and makes imports dearer.
See the data: AUD/USD.
General information, not advice.