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Australia Treasury Official: A$ A Shock Absorber For Economy

PERTH -(Dow Jones)- An Australian Treasury official said Monday that the Australian dollar is a "shock absorber" for the economy as resources investment booms.

David Gruen, Executive Director, Macroeconomics Group, Australian Treasury, said the country is seeing a "spectacular" amount of investment in the mining and energy sectors at present, fed by Chinese demand.

"And the Australian dollar is again playing a shock absorber role," he said, when asked by an audience member at a conference to comment on the current strong Australian currency.

The surge in mining investment is seeing other trading sectors of the economy "suffer relative to the resource sector."

"That's not good news for them," he said. "But from the point of view of Australia overall, the capacity of the exchange rate to help in the adjustment is one of the strengths of our system," Gruen said.

-By Stephen Bell, contributing to Dow Jones Newswires; 61-8-9244-4243; sgbell@ bigpond.com

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  11-09-090111ET
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