Australian inflation to drive Australian dollar exchange rates

In the early hours of this morning the latest unemployment rates were released for Australia. As expected unemployment rose by 0.1% to 5% however the market reaction has been limited as this was to be expected. Next week Australia will release their latest inflation numbers and these should be watched closely. Yearly inflation is set to fall to 1.5% from 1.8% and monthly inflation is set to fall 0.2% from last months 0.5%. If the numbers are released as expected this is going to put severe pressure on the Reserve Bank of Australia to rethink their monetary policy. As house prices are continue to fall and the market is stagnant, I expect a cut interest rates would be on the horizon and in turn this would devalue the Australian dollar.

In recent weeks the Australian dollar has been making gains against the pound. GBPAUD rates have dropped 5 1/2 cents making a AU$400,000 purchase  £6,700 more expensive. The pound has come under scrutiny due to the ongoing Brexit negotiation. The 6 month extension has put further pressure on businesses due to the uncertainty.  The negotiations will continue in the upcoming weeks however I don’t expect Theresa May and Jeremy Corbyn to find common ground. Therefore I am expecting the pound to continue to decline and be trading in the 1.70s sooner rather than later.

If you are trading GBPAUD this week, month or year I would recommend emailing me with the reason for the transfer (company goods, property purchase) and your timescales and I will response with the options available to you drl@currencies.co.uk. Alternatively if you would like to discuss your requirements over the phone call 01494-787478 and ask to be put through to Dayle Littlejohn.

** If you are already using a brokerage, I would strongly recommend you compare rates as I am confident I will be able to offer you additional savings with your transfer. All you need to do is email me with the exact figures and I will reply with our live price. This will take you a few minutes and in the past I have saved

Pound to Australian Dollar Forecast – Brexit Limbo does not bode well for the Pound

UK & Brussels at Impasse

Although investor concerns may have been eased following the Brexit extension the Pound still remains fragile and I would be surprised to see any significant gains against the Australian Dollar until we have firm news on Brexit. It seems as though the UK and Brussels are at a complete impasse, Theresa May has put several different alternatives to her deal to the House of Commons all of which have failed to gain a majority and Brussels have stone walled the UK stating it is the current deal or nothing.

European Council President, Donald Tusk sent out a warning to his “British friends” saying “please do not waste this time .” It seems as though another extension will be unlikely.

Brexit remains in Limbo and I would not be surprised to see us in a similar situation come October.

The Australian Dollar has its own problems however, Housing prices remain inflated in high wage growth areas such as Melbourne and Sydney. It mean Australians are being forced to spend their hard earned money on necessities rather than luxury goods and services.

Australia  has a heavy reliance on China purchasing its goods. The US/China trade war is causing a slowdown in Chinese growth which is having a knock on effect to the Australian economy and in turn the Australian Dollar. Iron ore is Australia’s primary export and fluctuations in its price can cause a change in Australian Dollar value, it is worth keeping an eye on if you have a trade involving the Aussie.

Recent news coming from US/China trade talks suggest an end could be in sight. US Treasury Secretary , Steven Mnuchin has stated we could see a conclusion to the trade war in under a month. If this is the case we could see substantial gains for the Aussie.

There are still however key points of contention. The US would like to keep existing tariffs in place in order to keep pressure on China , while Beijing would like them stopped immediately.

If you have a currency requirement I will be happy to assist. If you let me know the details of your trade I will endeavor to produce a free trading strategy. During a period of such uncertainty it is important to be in touch with an experienced broker if you wish to maximize your return. We have tools at our disposal to make sure you do not miss out if there is a spike in your favour.
If you already have a currency provider in place. Drop me an email with what you are being offered and I am very confident I will be able to demonstrate a significant saving. It will only take you two minutes and I am sure it will be worth your while. You can trade in safety knowing you are with a Foreign Currency Direct PLC, a firm trading for over 18yrs and FCA registered.
If you would like my help feel free to email me at dcj@currencies.co.uk.

Pound against the Australian Dollar falls as RBA may not cut interest rates

The Australian Dollar has seen some signs of strength recently as it appears as though the Reserve Bank of Australia may not be looking at cutting interest rates as soon as previously expected.

The Trade Wars between the US and China also appear to be getting closer to a resolution and as China is Australia’s largest trading partner this has helped the value of the Australian Dollar.

Australian is also a huge producer of Iron Ore and its main export market is China. Australia has approximately 65% of the global market and any price change in the value of the commodity will often affect the value of the Australian Dollar.

Chinese demand has started to increase for the commodity and rumours are increasing that many Iron ore mines in Brazil are due to be closing. This means that global supply will reduce which will in theory increase demand for Australian iron ore.

However, although the news is good concerning the news above, the risk going forward is that of the Australian election which is due to take place in just over a month’s time.

Labour are doing well in the polls so a change in leadership could see the Australian Dollar come under pressure once again so make sure you keep a close eye out on the election campaign as this is likely to have a big impact on the Pound against the Australian Dollar.

Meanwhile, the ongoing uncertainty caused by Brexit has caused the Pound to weaken marginally against a number of different currencies which is good news for anyone looking to buy Pounds at the moment as GBPAUD exchange rates are at the lowest rate in two months.

If you have a currency transfer to make and would like to save money on exchange rates then contact me directly for a free quote and I look forward to hearing from you. Having worked in the currency industry since 2003 for one of the UK’s leading currency brokers  I’m confident that I can save you money compared to using your bank for the transfer of Australian Dollars.

Tom Holian teh@currencies.co.uk

 

 

The impact of the Australian election next month on the Pound against the Australian Dollar

We are now just 5 weeks away from when the Australian federal election is due to take place on Saturday 18th May.

Generally speaking an election will often result in weakness for the currency involved as not only is the result uncertain but how will business be impacted causes uncertainty for investment in to the country during that period.

All of the 131 seats available in the House of Representatives are up for re-election as well as a total of 40 out of the 76 seats in the Senate.

At the moment current Prime Minister Scott Morrison is aiming to win another three year term but the opposition Labor party are looking to mount a challenge having been out of power for six years.

According to a number of polls recently the Prime Minister is potentially going to lose against the Labor party as they have pledged to reduce pollution levels by as much as almost half by 2030 compared to that in 2005.

The economy down under is also experiencing a slow down and with Morrison the seventh Prime Minister in the last ten years it appears as though Australians want to see a more stable government so we could be seeing a change coming in the next few weeks.

As we move closer to the election I think we could see the Pound making some improvements against the Australian Dollar so if you’re considering making a transfer to Australia it will be worth paying close attention to what happens during the election campaign during the next few weeks.

I have worked for one of the UK’s leading currency brokers since 2003 and I’m confident that I’m able to offer you bank beating exchange rates as well as providing a more detailed insight as to what is happening on the currency markets to help you make a more informed decision.

If you have a currency transfer to make and would like to save money on exchange rates compared to using your own bank then contact me directly and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

 

Pound to Australian Dollar Forecast – Daniel Johnson

GBP/AUD – Brexit continues to dictate GBP/AUD and at present the situation remains in Limbo. Theresa May has now failed on three separate occasions with her deal and at present the default action if a deal is not reached by 12th April is the UK will leave the EU with no deal. Both sides are desperate to avoid this situation and it looks as though the outcome will be an extension.

How long the extension will be and with what stipulations is what is being hastily negotiated. May favours a short extension whereas Brussels would like a flexible year extension in place.

I believe an extension is already factored into current GBP/AUD levels as the market moves on rumour as well as fact. I would expect Sterling to gain value if an extension is confirmed as investor concerns are eased. Do not expect any great shakes however.

GBP/AUD has remained above the key resistance point of 1.80 despite the lack of progress in Brexit talks, I think this can be mainly attributed to the probability of a no deal remaining low with the vast majority of the House of Commons set against allowing a no deal scenario to occur.

I think Sterling will however remain fragile until we have firm news on Brexit, which now could be some way off. The Australian Dollar has it’s own concerns however. Housing prices in high wage growth areas continue to inflate and Australians are being forced to spend their money on necessities rather than luxury goods and services which is hurting the economy. The ongoing trade war between the US and China is also a key concern. Australia has a heavy reliance on China purchasing it’s exports, particularly iron ore. In fact iron ore value has been known to cause sways in the value of the Aussie.  The trade war is influencing Chinese growth which in turn has an impact on the Australian economy and the Australian Dollar.

Investors are choosing to shy away from riskier commodity based currencies in favour of what is considered to be safe haven currencies such as the Swiss Franc or the US Dollar.

I think if it were not for Brexit we could be seeing gains for Sterling against the Aussie, but at present you really need someone with an eye on the markets for you if you wish to take advantage of any spikes on the market, which recently have only been small windows of opportunity.

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker when the market is currently so hard to predict. If you let me know the details of your trade I will endeavour to produce a free trading strategy to suit your individual needs. Have faith knowing you will be dealing with a brokerage in business for over 18yrs, Foreign Currency Direct Plc. We are a no risk entity as we do not speculate on the market and we are registered with the FCA. If you have a currency provider take a minute to send over the rates they offer and I am confident I can demonstrate a significant saving. I can be contacted at dcj@currencies.co.uk .

AUD Forecast – RBA Keep Interest Rates on Hold at Record lows as GBP Finds Support Overnight (Matthew Vassallo)

GBP/AUD rates have spiked back above 1.84 overnight, as the Pound continued its recovery following last week’s losses.

Sterling was under considerable pressure following UK Prime Minister Theresa May’s failure, to once again get Parliamentary approval for her Brexit deal. This was the third time she has failed to gain the necessary support from MP’s and investors reacted to this by selling off their GBP positions, causing a sharp dip in value for the Pound.

This downturn inadvertently boosted the value of the AUD, which has had its own problems recently. The AUD saw its value increase by over four cents against the Pound, hitting 1.8290 at the high.

At this stage it seemed as though GBP/AUD exchange rates could be heading back towards 1.80, with the markets seemingly losing faith in the UK’s ability to find some common ground over Brexit, with MP’s unable to agree upon the best way forward in regards to a Brexit deal with the EU.

With further twists likely in this ongoing saga, those clients holding GBP may look at this week’s upturn as an opportunity, with the uncertainty over the UK’s final Brexit position likely to hamper any significant upturns for Sterling.

Looking at the Australian economy and the Reserve Bank of Australia (RBA) met last night and as anticipated kept interest rate son hold at the current record lows of 1.5%.

Like other commodity based currencies, the AUD has struggled to impose itself of late, with a slowdown in global trade causing investors to shy away from riskier assets such as the AUD. With the Chinese economy also showing signs of a longer-term slowdown, due for the most part to the on-going trade stand-off with the US, the outlook for the Australian economy remains dovish.

If you have an upcoming GBP or AUD currency transfer to make, you can contact me directly on 01494 787 478. We can help guide you through this turbulent market and as a company we have over nineteen years’ experience, in helping our clients achieve the very best exchange rates on any given market.

Our award winning rates can be accessed very easily over the phone and I can keep you posted with key market developments ahead of any prospective exchange you need to make.

Feel free to email me directly on mtv@currencies.co.uk to find out all the options available to you ahead of your currency transfer.

Will the Australian dollar weaken this week?

The Australian dollar exchange rate has been trending lower in 2019 on the increased expectation that we will in the future see the RBA, Reserve Bank of Australia cut their base interest rate. Numerous commentators have for now many months been commenting that we could soon see the RBA forced to take action against numerous global and domestic factors.

In Australia there has been a growing concern over Inflation levels which the RBA had targetted to see at 2-3% but has been averaging around 1.5%. To boost Inflation levels which are now at close to 10 year lows, the RBA might need to cut interest rates to help provide some stimulus to the economy.

Cutting interest rates by a central bank can do various things which can help an economy to grow. Firstly, it can make the currency cheaper to buy which can help the country to increase exports, thereby improving the economy. Secondly, it makes loans and borrowing less costly which can encourage business and consumers to spend more, thereby increasing economic activity.

The currency becomes less valuable from the cutting of interest rates in a similar fashion to the way a lower or higher rate of interest makes a particular savings account more or less attractive.

Interest rates are of importance on the Australian dollar and are a major factor in determining the relative strength or weakness of the currency. There is a growing expectation that we could in the future see the RBA cut rates which will see the currency weaker.

It is not just the domestic issues of a sluggish economy, it is also the ongoing uncertainty surrounding the more global problems and concerns which are relating to the economic outlook on global trade.

A key example is the ongoing Trade Wars and spat between China and also the US, this has seen global trade drop and with China being such a key partner to Australia, could continue to be a major factor.

With such global pressures on trade continuing, as evidenced by the United States Federal Reserve stating they will not be raising interest rates as soon as many thought earlier this year, the Australian dollar might continue to suffer from weakness, as it responds to continuing and ever-changing global shifts.

Pound to Australian Dollar: Brexit continues to Dictate GBP/AUD

The Brexit saga continues and now we are looking at an extension. GBP/AUD rates had recently risen to the highest levels since June 2016, breaching 1.88. This can be attributed to positive news surrounding Brexit, rumours were circulating that Brussel’s could make concessions on the Irish border and the chances of a no deal scenario dropped considerably.

PM Theresa May addressed the nation yesterday evening and made a plea to MPs to support her deal ahead of what is likely to be a third and final meaningful vote.

May also confirmed she had written to President of the European Commission, Donald Tusk to request an extension to Article 50. she has requested an extension until 30th June.

She also stated that she would not approve a long term extension to Article 50. This immediately raises the question whether this means she is prepared to step down as Prime minister should her deal be voted down and and then vote for a lengthy extension for talks.

She also said “this House will have to decide how to proceed”, if her deal is rejected for a third time.

If May were to resign you can expect this to hurt Sterling significantly.  GBP/AUD has now dropped into the 1.84s.

 US/China Trade War –  Due to Australia’s heavy reliance on China purchasing its goods and services and slow down in Chinese growth has a kick back on the Australian economy and in turn the Australian Dollar.

The US/China trade war is currently hurting the Australian Dollar and if it were not for Brexit I think Sterling could be making decent gains against the Aussie.

There were rumours the trade war could be resolved by the end of the month, but Trump yesterday threw a spanner in the works saying the following:

“We’re not talking about removing them, we’re talking about leaving them for a substantial period of time,”  “Because we have to make sure that if we do the deal with China that China lives by the deal because they’ve had a lot of problems living by certain deals.”

Brexit will continue to be the key driver on GBP/AUD. I think at this point we are looking at an extension as both parties do not wish to deal with a no deal scenario. I think if an extension is called there will not be any great shakes on the market. If Brussels do give concessions on the Irish border however, expect substantial Sterling strength.

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker if you wish to maximise your return. If you let me know the details of your trade I will endeavour to produce a free, no obligation trading strategy for you. If you have a trade to perform I will also happily provide a free quote and I am confident our rates are among the best in the industry. I would be willing to demonstrate this in form of a comparison with any competitor. You can trade in safety knowing you are dealing with company FCA registered and one that has been trading for 18yrs. Foreign Currency Direct PLC.

If you would like my assistance I can be contacted at dcj@currencies.co.uk.

Pound to Australian Dollar rate today and what will happen to rates after 29th March?

The Pound has been challenging 1.87 on the Interbank level against the Australian Dollar over the last few days but has struggled to hold on to its gains for any sustained period.

Sterling has made the gains owing to a number of reasons but arguably the two most important factors affecting the Pound vs the Australian Dollar is that of China and Brexit.

The impact of China on the Australian Dollar

China appears to be back tracking on its arrangements with the US in terms of its trading position and this is likely to impact trade between China and Australia. The Trade Wars are still going on between the two superpowers and this is causing a problem for the Australian Dollar.

China is Australia’s largest consumer of its natural resources and as Australia is heavily influenced by commodity prices as well as demand from the world’s second largest economy any reduction in demand will often tend to weaken the Australian Dollar and this appears to be what is happening at the moment.

The impact of Brexit on the Pound to the Australian Dollar

Turning the focus back towards what is happening in the UK and it is Brexit that is dominating all the headlines at the moment. The Speaker of the House John Bercow recently announced that the Prime Minister will not be allowed to hold another ‘meaningful vote’ if the new deal is very similar to that already proposed which was voted against recently.

With just ten days to go before the UK is set to leave the European Union things are still uncertain as to what will happen next. The likelihood is that Brexit will be postponed but for how long is the most important question.

Theresa May is due to travel to Brussels to discuss the terms of any delay but all the 27 members of the European Union will have to agree to any proposed extension period so there is still a risk to the value of the Pound.

I personally think that a no deal Brexit will be avoided and an extension will be granted and once this happens depending on the length of the delay I think this could provide the Pound with some real support against the Australian Dollar.

If you have a currency transfer to make and would like to save money on exchange rates compared to using your own bank then contact me directly for a free quote and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

 

AUD Forecast – Despite Brexit Uncertainty the AUD Remains Under Pressure (Matthew Vassallo)

The AUD has come under increasing pressure over recent weeks, with the Pound now trading around 1.87.

GBP has regained approximately 5 cents in the past few weeks, which is the equivalent of an additional 5000 AUD on 100k GBP/AUD currency exchange.

The Pound has made these inroads despite the on-going uncertainty surrounding Brexit. With the UK’s current exit deadline fast approaching, we still do not have any clarity on what the final outcome will be and this in itself you could argue, should be restricting any major improvement for GBP.

It seems as though the markets have spiked on the back of Parliaments decision last week, to move away from a no-deal Brexit outcome. However, unless UK Prime Minster Theresa May can convince MP’s to vote on her Brexit deal at the third time of asking, then an extension to Article 50 looks like the only remaining option.

How long any prospective extension might be is now what the markets will likely focus on and any further improvements for the Pound, will likely be impacted by this decision. With rumours of a two-year extension being floated, how will investors and the public react to such a scenario?

If an extension is granted without any indication of an agreement being virtually in place, then investor confidence could take a hit. It is likely to be followed my major public unrest, with people seemingly losing patience with the on-going saga.

Looking at the Australian economy and with concerns over falling house prices and a slowdown in global trade, investors seem to be shying away from the once popular AUD.

Add this to concerns that the Reserve Bank of Australia (RBA) will look to cut interest rates possibly twice this year and it is easier to understand why the Pound has made inroads against the AUD of late, despite investors remaining cautious about the Pound and its future prospects.

If you have an upcoming AUD currency transfer to make, you can contact me directly on 01494 787 478. We can help guide you through this turbulent market and as a company we have over nineteen years’ experience, in helping our clients achieve the very best exchange rates on any given market.

Our award winning rates can be accessed very easily over the phone and I can keep you posted with key market developments ahead of any prospective exchange you need to make.

Feel free to email me directly on mtv@currencies.co.uk to find out all the options available to you ahead of your currency transfer.