Christmas Island Dollar

AAA

DEFINITION of 'Christmas Island Dollar'

The former currency of Christmas Island, an Australian island in the Indian Ocean that was discovered on December 25, 1643. Today, the Christmas Island dollar is obsolete, with Christmas Island now using the Australian dollar. This switch from the use of a local currency to the use of another jurisdiction's currency is called dollarization and is a common phenomenon throughout the world. Dollarization can help a country obtain currency stability and encourage both domestic and foreign investment. The Australian dollar is one of the most frequently traded currencies in the foreign exchange market.

BREAKING DOWN 'Christmas Island Dollar'

In 2010, Christmas Island had an estimated population of less than 1,500 people. Most of the island is a national park. English is the official language, although the majority of the population is Chinese. The island's economy consists of tourism and a dwindling phosphate extraction industry. Other places that use the Australian dollar include the Pacific islands of Nauru, Tuvalu and Kiribati as well as Norfolk Island.

RELATED TERMS
  1. New York Dollar

    The buying power of a U.S. dollar in the city of New York. The ...
  2. Dollarization

    A situation where the citizens of a country officially or unofficially ...
  3. CAD (Canadian Dollar)

    The currency abbreviation or currency symbol for the Canadian ...
  4. JMD

    The currency abbreviation or the currency symbol for the Jamacian ...
  5. Confederate Dollar

    A currency issued by the Confederate States of America during ...
  6. KYD

    The currency abbreviation or currency symbol for the Cayman Islands ...
Related Articles
  1. Options & Futures

    A Primer On The Forex Market

    Moving from equities to currencies requires you to adjust how you interpret quotes, margin, spreads and rollovers.
  2. Forex Education

    Currency Exchange: Floating Rate Vs. Fixed Rate

    Baffled by exchange rates? Wonder why some currencies fluctuate while others are pegged? This article has the answers.
  3. Personal Finance

    The Currency Board: Understanding The Government's Bank

    Currency board, central bank - what's the difference? Find out more about this little-known monetary authority.
  4. Forex Education

    Top 7 Questions About Currency Trading Answered

    Whether you're puzzled by pips or curious about carry trades, your queries are answered here.
  5. Forex Education

    Dollarization Explained

    Find out how fledgling economies can find some stability in their currency and attract foreign investment.
  6. Bonds & Fixed Income

    6 Factors That Influence Exchange Rates

    Find out how a currency's relative value reflects a country's economic health and impacts your investment returns.
  7. Personal Finance

    What Are Central Banks?

    They print money, they control inflation, and much, much more. All you need to know about central banks is here.
  8. Mutual Funds & ETFs

    The Top 3 ETFs For Investing in Australia

    Learn about some of the best performing exchange-traded funds that investors use to obtain exposure to stock investments in Australia.
  9. Retirement

    How To Set Up A Trust Fund In Australia

    No, they're not just for the super-rich. But you need to know the rules.
  10. Personal Finance

    How To Budget Your Trip To Australia

    Australia is expensive to reach from almost everywhere, so plan carefully so you can do all the exploring you've dreamed about.
RELATED FAQS
  1. What developed countries have the greatest exposure to metals and mining?

    The developed countries with the most exposure to the metals and mining sector are Canada, Australia and the United States. ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Bubble Theory

    A school of thought that believes that the prices of assets can temporarily rise far above their true values and that these ...
  2. Stock Market Crash

    A rapid and often unanticipated drop in stock prices. A stock market crash can be the result of major catastrophic events, ...
  3. Financial Crisis

    A situation in which the value of financial institutions or assets drops rapidly. A financial crisis is often associated ...
  4. Election Period

    The period of time during which an investor who owns an extendable or retractable bond must indicate to the issuer whether ...
  5. Shanghai Stock Exchange

    The largest stock exchange in mainland China, the Shanghai Stock Exchange is a nonprofit organization run by the China Securities ...
  6. Dead Cat Bounce

    A temporary recovery from a prolonged decline or bear market, followed by the continuation of the downtrend. A dead cat bounce ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!