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The first colony in 1788 of New South Wales had very few foreign and english coins. Rum was often used as a form of exchange. The earliest form of currency used in Australia was english coins and spanish dollars. in the 1800’s the spanish dollar became known as the Holey dollar and dump. Governor Macquarie did not want the spanish dollars leaving Australia on the ships so ordered for their centres to be removed thus creating ‘the Holey dollars’ and the removed centre being known as ‘the Dump.’ In 1813 the Holey Dollars had “New South Wales 1813” stamped on one side and “five shillings” on the reserve. The Dump coin had “fifteen pence” on one side and “New South Wales 1813” on the other side.

In 1910 the Australian pound was first introduced. It was fixed to the British pound and fluctuations in the value of the British pound greatly affected the Australian economy. In 1966 the Australian Dollar replaced the pound as Australia's currency.

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Australia was the first country to use plastic bank notes. Money made from Polymer was found to last four times longer than paper banknotes and much harder to counterfeit. The first plastic Australian dollar bills were issued in 1988 and by 1996 all bank notes in Australia were made of Polymer.

The Australian Dollar is the official currency of Australia. The ISO 4217 currency code for the Australian Dollar is AUD.