This paper analyzes the international transmission of monetary shocks with a special focus on the effects of foreign money (global liquidity) on open economies. Structural VAR models are estimated for the countries Australia and New Zealand and the variance decompositions and impulse responses are found. The impulse responses obtained show that a positive shock to global liquidity results in a decrease in output and price level for both countries over a three-year horizon. Similar reductions in the money supply were also discovered. Moreover, this analysis discovered that economies of different sizes do, in fact, respond differently to innovations in global liquidity.