Evaluate value for money according to iPod index

Australia Investment Bank Commonwealth Securities Ltd. just developed a new index called the iPod Index, using Apple's iPod product price as the benchmark to track international currency values.

Commonwealth Securities said that the iPod index valued the world's currencies by comparing the price of a 2-gigabai iPod Nano music player in dollars in different countries.

The iPod is based on an economic principle, which calculates a dollar that will buy the same amount of goods across countries, and other currencies will fluctuate near the difference in purchasing power.

Theoretically, if the price of iPod Nano converted into a dollar is too expensive in Australia compared to the US, then the Australian dollar may be considered too high. In the US, the iPod Nano retail price is 149 USD (114.99 euros), while the iPod price in Australia is 172.36 USD (133 euros). The iPod is the cheapest sold in Canada for about $ 144.2 (111.28 euros).

Australian economist Craig James said that if there is a high price gap, customers can switch to buying in other countries, especially with the help of Internet tools. This index shows that the dollar has the potential to increase against most major currencies, of which the Australian dollar is currently about 15% higher than the real dollar.