FXStreet (Delhi) - Research Team at NAB, note that despite the degree of AUD depreciation since mid-2014, there is actually a higher proportion of firms in the survey indicating a negative impact from the current level of the AUD (around a third of firms). Key Quotes “While this is counter to the idea that a lower AUD will aid the economy’s transition through the end of the mining boom, this appears to largely reflect significant variation in the impact across industries – driven primarily by a sharp deterioration reported by the wholesale sector, and to a lesser extent the retail and transport sectors . Other key sectors of the economy (such as services), appear to be largely insulated or are better off from the depreciation.” “As the AUD has depreciated, firms appear to have become even more focussed on hedging and import substitution, as opposed to greater cost cutting (e.g. downsizing)." “In particular, currency depreciation over recent years appears to be having the greatest impact on exporter hedging, with these firms electing to hedge a growing share of their exposure (32% in Q3 2015 compared with 24% in Q1 2013). Yet, at the same time they are also reducing the average hedge tenor (almost 8 months in Q3 2015 compared to almost 10 months in Q1 2013). In contrast, importers have kept a fairly constant share of their FX exposures hedged in recent quarters (35%), although this is below the levels seen back in 2013 (around 40%).” “Interestingly, larger export firms have increased their FX exposures that are hedged markedly in recent quarters, to over 40% in Q3 2015 (compared to 27% in Q1 2014). Medium exporters have pulled back after a big increase over 2014. The proportion of FX exposures hedged by importers has been relatively steady across all firm sizes in recent quarters.” For more information, read our latest forex news.