The iShares MSCI Australia ETF (NYSEArca: EWA) is up 1.3% year-to-date, a deceiving performance given the fund’s recent tumble.

Since Feb. 25, EWA, the largest U.S.-listed Australia ETF, has plunged nearly 6%, indicating Australian stocks are not responding favorably to ongoing weakness in the Australian dollar. Over the same period, the CurrencyShares Australian Dollar Trust (NYSEArca: FXA) is off 3.8%.

Reserve Bank of Australia Assistant Economic Governor Christopher Kent recently said that in the near-term, unemployment in the world’s 12th-largest economy is likely to ticker higher and that economic growth will be anemic. However, his longer-term view of the Australian economy is rosier.

Even patient investors mulling exposure to Australia ETFs are faced with a conundrum: Australian stocks are expensive, at least according to Goldman Sachs.

Finding value in the Aussie equity market has never been harder; at an average of 19x forward P/E, Industrial stocks have never been this expensive: Growth had already re-rated, but now even ‘cheap’ stocks trade at unprecedented multiples; Seeking defensives with some valuation support, we upgrade Staples to Overweight from Neutral,” said the bank in a recent note.

While Goldman’s bullish views on Australian consumer shares could be seen as encouraging, the bank’s downgrade of Aussie banks to underweight from neutral is concerning for EWA investors. The ETF allocates 53.7% of its weight to the financial services sector but just over 9% of its combined weight goes to staples and discretionary sectors. [Say G’Day to Australia ETFs]

Not surprisingly, Goldman is less than enthusiastic about Australian commodities exporters, which are being crimped by slack demand and the strong U.S. dollar. EWA devotes 15.4% of its weight to the materials sector, including an 8.2% allocation to BHP Billiton (NYSE: BHP), shares of which are off 3.7% this year.