THE strong Australian dollar against the US greenback is a mixed blessing for the local economy.
According to an economist at CommSec, Savanth Sebastian, the strength of the Australian dollar will also play a significant part in dictating future economic policy moves.
''The Reserve Bank is well aware that the Australian dollar is effectively acting as a quasi rate hike - curbing export receipts while slowing manufacturing activity and having a detrimental impact on the tourism sector,'' he said.
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''Encouragingly, the strength of the Aussie will support the Reserve Bank's efforts in keeping inflation low.''
The NSW head of industrial at Jones Lang LaSalle, Andrew Maher, said the strong dollar was also good for the industrial sector in NSW and would support demand for imports.
''With a resurgent Australian dollar and the likelihood of an increase in the volume of imported goods, we expect container volumes, known as Twenty-foot Equivalent Units [or TEUs, the international measurement] that move through Port Botany to continually rise through the final quarter of 2010 and well into 2011,'' Mr Maher said.
''Areas set to benefit from the pick-up in container trade include the south-west M5 corridor, where convenient access is enabled to Port Botany via the M5 motorway, and in areas such as Yennora, where sites can handle container rail freight direct from the port.''
In August, the Sydney Ports Corporation's statistics showed the port reached its highest container volumes on record, reaching 182,200 TEUs, an increase of 16.5 per cent on the same period last year.
The national head of industrial at Jones Lang LaSalle, Michael Fenton, said Port Botany has been recording a strong rebound in trade volumes since late 2009, bringing it back to pre-global financial crisis levels.
''We know that Australian businesses have been in an inventory-rebuilding phase since late 2009,'' Mr Fenton said.
''This rebuilding phase is having a flow-on effect to demand for warehouse and distribution space in the industrial sector.
''Our analysis clearly shows container trade activity has a positive relationship with the take-up of industrial space, rental growth and land values.''
Mr Fenton said he had anticipated a sharp upturn in demand for goods once economic conditions improved and despite the headwinds from global market volatility.
