Essay Writing - Part 2

2nd speaker body paragraph – 15-20 (25 max) lines

This paragraph fully carries your argument

• It does it through: examples, statistics, quotations and a case study (if you were to color code each body paragraph each of the four elements should be noticeable at a glance)
• Each and every body paragraph, without exception must be introduced in the very first sentence by a ‘topic sentence’ : this topic sentence will mention the key word/s stated in the question.

This is what a persuasive Body Paragraph looks like

Any advantage that an appreciation of the Australian dollar might have on foreign trade in the short term, such as the lower price of imports, higher export income, lower domestic inflation, a reduction in net foreign debt and the debt servicing ratio (ibid, 139) would soon be eroded away by a sustained currency appreciation. Riley observes that “ … an appreciation of the exchange rate reduces competitiveness of the tradable goods sector” (ibid, 139), and cites the

reduction in export income, the increase in import expenditure and a worsening current account deficit in the balance of payments as the specific consequences that might be expected from such a long period of appreciation in the exchange rate. One way that greater control can be exercised to prevent such an undesirable scenario is for the RBA to manage the economic dynamics at work through intervention. It can intervene directly as a buyer or seller.

It can intervene indirectly by changing the level of interest rates through its market operations. Also the government may change its fiscal policy to either increase or decrease the rate of economic growth (ibid, 135) and so impose the most favorable conditions for sustained economic progress. Such macro economic policies are vital for the well being of the Australian economy. The Reserve Bank Foreign Exchange Transactions and Holdings of Official Reserve Assets 2001-02 to 2007-08 reveal a pattern of intervention that confirms this

role. For instance, in the period 1999- 2001, the RBA effected a large-scale purchase of the Australian dollar to prevent excessive depreciation caused by a loss of confidence in the Australian dollar due to its being drawn into the ‘contagion effect’ of the Asian currency crisis. (ibid, 137) . Conversely, between 2002 and 2004 against the backdrop of a growing appreciation of the AUD, the Reserve Bank purchased over five billion AUD of foreign exchange annually between 2002 and 2006 in order to maintain the competitiveness of

Australian exporters.