Monthly Archives: July 2012
Australian Dollar continues to strengthen against GBP, USD & EUR
The Australian Dollar has continued its run of strength against the pound, US Dollar and Euro. Yesterday the Aussie reached its highest ever level against the Euro and was trading at a 4 month high against the pound. These are amazing levels for selling your Australian Dollars.
The Australian Dollar is an extremely volatile currency. Investor sentiment has a big effect on the state of the Dollar. With hopes of a resolution to come out of Europe on Thursday to help solve the regions debt crisis investors have been looking once more to the riskier southern hemisphere currencies.
I would not be surprised to see the AUD continue its strong run. Should data out of China or Australia’s retail sales and trade balance data out in the early morning on Thursday, come out slightly negative then we may see the gains reversed.
If you would like assistance in making a saving over the high street banks on your currency exchange then do please feel free to contct me at bma@currencies.co.uk. I help many clients all over the world use our service to buy any major currency. We can typically save you up to 4% on your exchange while also offering you a very personal service which the banks just will not do. We also have differnt options that may suit your requirement from forward buying to placing stop loss and limit orders. If you would like information on any of this please do email me with your contact details and I will call you to explain all the options that are available to you.
GBP/AUD Rates remain below 1.50, is this a good time to sell AUD?
Sterling exchange rates have fallen below the 1.50 level against the Australian dollar for the first time in a number of weeks, is this a good time to sell dollars? What data is likely to affect the Australian dollar this week? As my colleague Tom mentioned, we have the ECB and UK releasing their respective interest rate decisions at 12:00 and 12:45 – these should be closely monitored as they can have a big impact upon market conditions. Other data sets to keep an eye on include UK house price data from Nationwide at 07:00 on Wednesday (the UK is heavily dependent on the housing market and this data can impact GBP exchange rates heavily, and from Australia we have retail sales figures overnight also on Wednesday, any improvement and the AUD could continue its recent surge (we have seen the rates rally nearly 9% in less than three months).
As with any financial product it is imperative to look around and compare rates to make sure you are getting the best price. Through using a specialist currency broker it ensures your are getting the best market knowledge and price, something that is key to getting the very best deal on your exchange. With saving upwards of 2-3% when compared to the banks thousands of clients have benefitted from our bespoke currency service, should you wish to discuss the market in more detail and what data may affect your currency requirement then please contact Mike directly on mgv@currencies.co.uk and I will happily give you my professional view to help you make a right decision with your exchange.
Italian & Spanish Concern eases which strengthens the Australian Dollar against Sterling
The Australian Dollar has strengthened today back to 1.4950 against Sterling as concerns in Europe have eased on hopes that the Euro zone may act to lower borrowing costs. Spanish 10 year bonds which hit 7.5% last week have dropped to 6.5% showing that investors are coming back to the market. Italian bonds dropped to 5.96% the lowest since April which again raised confidence on the single currency. UK GDP which dropped to -0.7% last week has sent shock waves through the currency markets and the appetite for Sterling as a safe haven may have changed. Both the UK and ECB release their interest rate decisions on Thursday at 12pm and 1245pm respectively and any cuts for either could signal some volatility. Personally, I think neither will move interest rates and wait to see how recent QE has performed. With the UK having added £50bn last month I think it’ll be some time before the BoE considers any interest rate cut.
If the GBPAUD continues to remain below 1.50 we could see the next level of support at 1.4750 so if you need to make a currency transfer please contact me to find out how I can save you money when buying Australian Dollars teh@currencies.co.uk
What will happen to the Sterling Australian Dollar Exchange rate in August 2012
With the opening ceremony for the Olympics just a few short hours away Sterling vs Australian Dollar exchange rate has remained relatively quiet this morning. The good news for buying Australian Dollars is that the Pound has recovered and we are now seeing rates getting closer to 1.51 having dropped into the 1.49s earlier this week. UK GDP out on Wednesday was measured at -0.7% much lower than expected and lower than the previous quarter measured at -0.3%. This is not good news for the UK economy so it could be suggested that an interest rate cut or further QE could help our ailing economy and Sterling weakness across the board could drive an export led recovery. It is unlikely that the Sterling Euro exchange rate will fall as the problems in Spain seem to be growing on a weekly basis but I would expect GBPAUD to drop below 1.50 during August particularly if the Bank of England do not go down the line of further QE. The lowest I anticipate GBPAUD to trade is 1.4750 as anything lower than this could have a negative impact on the Australian economy and the highest 1.53 if next week’s British data releases are better than anticipated.
Yesterday David Cameron defended UK’s economic policies by saying the government has acted ‘decisively to restore confidence in its public finances.’ Labour attacked the figures and claimed that the current government’s plans had not worked. This hasn’t had much effect on the markets but as usual with currency the movements will occur following political or economic events so if you have any queries or questions please do not hesitate to contact me teh@currencies.co.uk or if you have a currency transfer to make and would like to ask me how to save money when buying currency feel free to ask me a question. Please aways remember to quote ‘AUSTRALIAN DOLLAR FORECAST’ in the subject title of the email.
UK Recession worse than expected causing Sterling losses
The GBPAUD exchange rate has dropped this morning by 0.75% since the announcement of the UK GDP figures. The data showed that output in the UK has declined by 0.7% between April and June according to the ONS. This is the third quarter in a row that this has happened. The first three months saw a drop of 0.3% so we could be in for a troubled period for the UK economy and Sterling. According to Alan Clarke from Scotiabank ‘this is a disaster for UK growth…and on average for the year, it’s looking very unlikely that we’ll be on the right side of zero growth. more likely we’ll be contracting.’
If we look at the currency markets it seem apparent that the data release was not full priced in as GBPEUR, GBPAUD & GBPNZD have all dropped this morning following the ONS official data. This movement highlights the volatility of the currency markets and the importance that you stay in contact with your experienced currency broker who can alert you when the markets move quickly. You can also utilise a currency broker to help you gain better exchange rates than your bank and help you with various tools such as Stops & Limits and Forward contracts which allow you to fix a rate up to two years in advance if required.
The Forward contract is particularly useful for those clients looking to emigrate which can sometimes take a long period of time before your official visa is granted. Therefore, you may wish to buy forward to know how much your money will buy. For further information as to how to save money when buying Australian Dollars or any other of the 35 currencies we trade please do not hesitate to contact me Tom Holian teh@currencies.co.uk
Why is the Australian Dollar Strong against the Pound?
The Australian Dollar remains strong against the Pound even though the problems in Europe mean that investors are wary about hugely committing to the Australian Dollar. The problems in Europe have also meant that Sterling is being used as a safe haven which has kept the Pound relatively strong against many currencies and meaning that the GBPAUD exchange rate has not yet broken below 1.50. Spanish bonds have risen to worrying highs and yesterday hit 7.56% a Eurozone record. The release of Chinese PMI came out at 49.5 which although represents contraction it was higher than the previous month which was 48.2. The slightly higher than expected reading meant that as long as China continues to grow this could keep the Australian Dollar supported not just against Sterling but also against Japanese Yen, US Dollar and the Euro.
Central Bank Governor Glenn Stevens has said today in a speech that Australia is in a good position to avoid the global financial crisis and should continue with its current economic policy. The banks seem to be holding up well even though some had made poor lending decisions but he also went to say that the RBA can and will stimulate the economy if necessary. The growing Chinese economy has seen a large demand for energy and resources which has pushed Australia’s trade to all time highs which has supported the Australian currency.
For further information or if you would like a free quote to buy or sell Australian Dollars please contact me Tom Holian teh@currencies.co.uk quoting ‘Australian Dollar Forecast’ in the title.
Spanish Woes cause Australian Dollar Weakness
Spanish bonds have hit 7.5% today and six of Spain’s regions have told the government that they will need extra funding. Spain has already asked and been given a bailout of its banks last week and this could cause panic across the 17 different Eurozone nations as this could trigger a bailout for Spain in the next few weeks. Stock indices across the globe have all fallen by over 1.5% today and Spanish banking shares in particular have been heavy hit. Short selling has been banned in Spain for three months in order to put a stop to the problems.
The resulting fears has caused the Australian Dollar to weaken against Sterling as investors move out of perceived riskier currencies and sought the relative safety of the Pound. The AUD has recently benefited from the stability within Europe following the conclusion of the Greek issue but now we could see a strong moe for GBPAUD exchange rates. As of time of writing the GBP is trading at 1.5120 on mid-market.
If you have a currency transfer to make and would like to compare against your own currency broker email me for a free quote teh@currencies.co.uk
AUD a Safe Bet for Investors
The AUD has made further gains during Thursdays trading against both GBP and the EUR, although it has lost some ground against the USD. The Australian Dollar has weathered the EU financial crisis better than other currencies and has in fact continued to strengthen on the whole, during this turbulent time for the global economy.
It has as been discussed in previous blogs that this strength has been fuelled by China’s demand for Australia’s raw materials and its reliance therefore on Australias affluent mining sector and with China’s economy now the second largest in the world, this demand has only increased. With high interest rates, it is also very attractive for investors looking to carry trade (the process of purchasing currency in a low interest country, Japan for example and then moving it to one with a higher rate of interest like Australia, to benefit from this disparity).
The AUD has reached an all time high against the EUR, touching on 1.17 and is currently pushing the 1.50 barrier against GBP. How much further it can go will depend on how events in Europe unfold and whether China’s demand and growth prospects over the coming months remian high, which i think is highly likely.
Personally I feel the AUD could go even further against the EUR, whilst investor confidence remains at an all time low and it wouldn’t surprise me if we saw the 1.50 barrier broken again against Sterling over the coming weeks.
If you have an upcoming currency requirement or would like to be kept up to date with all the latest market movements, then
Are you getting the best exchange rate when transferring Australian Dollars?
If you have used the bank to transfer money overseas and found the process long winded and loaded with fees it is probably time you spoke with a currency broker who can offer you better exchange rates. The account opening process should be straight forward and the pricing offered transparent so that there are no hidden fees or commission. If you would like to compare exchange rates with your bank you may be surprised as to how much a currency broker can save you. Typically the saving can be up to 4% depending on the volume that you may be looking to transfer. The difference this can make on a AUD$200,000 currency transfer could be as much as £5,300 a huge difference I’m sure you’ll agree.
Therefore, if you would like to speak with an experienced currency broker as to how the process works when exchanging Australian Dollars or indeed any other foreign currency please do not hesitate to contact me Tom Holian teh@currencies.co.uk quoting ‘Australian Dollar Forecast’ for preferential exchange rates.
