International travel will become more expensive. As the Australian Dollar falls, the price of taking an overseas holiday will rise. This might make travelling inside Australia a better option. A cheaper dollar also makes Australia a cheaper destination for overseas tourists. We have already seen tourism replace Iron Ore as Australia's biggest export.

There are ways to hedge against the falling Australian Dollar. One simple way, is to bring forward any international spending you are planning. For example, you might want to buy that new car or tv before the falling dollar drives those prices up.

Another way to hedge is to speculate on the foreign exchange market. This carries a lot more financial risk, as it is possible incur serious financial losses. One way is through Contracts for Difference, which allow you to speculate with as little as $25 of your own funds. We have experimented with Plus500 , and found their platform very easy to use. There is also a demo mode so you can test your trading skills without using real funds.