Monthly Archives: November 2016

US Interest Rate becoming more likely causing Australian Dollar Weakness vs Sterling (Tom Holian)

Sterling vs the Australian Dollar has hit recent highs during today’s trading session as US economic data came out much better than expected.

We are now just two weeks away from the US interest rate decision and as the economic data has been very positive recently this has led to an increased chance that the US will raise interest rates. US non-farm payroll data is due out on Friday and if the data is positive once again this could be the catalyst to send GBPAUD rates in an upwards direction.

The impact this has on GBPAUD exchange rates is a positive one as it means that global investors are less likely to hold the riskier AUD and plough into the USD which results in Australian Dollar weakness.

The Pound has made huge gains vs the Australian Dollar and the next target for anyone looking to buy Australian Dollars could be 1.70.

If you’re in the process of selling Australian Dollars to buy Sterling but do not yet have funds available it may be worth looking at buying a forward contract which allows you to fix an exchange rate for a future date.

The one sticking point for Sterling though is the ongoing uncertainty surrounding the Brexit talks and the Article 50 issue and until we have some form of resolution we could see a bit of a rollercoaster for the Pound.

Having worked in the foreign exchange industry since 2003 I am confident of not only offering you better exchange rates than using your bank but also help you with the timing of you purchase of funds.

If you have a currency transfer to make and want to save money on exchange rates when buying or selling Australian Dollars compared to using your own bank then contact me directly for a free quote.

Tom Holian teh@currencies.co.uk

 

 

OPEC Meeting could swing Australian Dollar value (Daniel johnson)

Australian Dollar Outlook

Today the Organisation of the Petroleum Exporting Countries (OPEC) will meet. There has been a push in recent times by the member states  to limit oil production to force oil prices higher, over supply has been a large problem for a considerable time. It has taken long and tough negotiations to get to this stage.

Australia is a commodity based currency and can be influenced heavily by oil price. Any rise in oil value should see Australian Dollar strength. The oil price has been rising in anticipation that a deal will come to fruition in Vienna. The main concern for a breakdown is negotiations is Iran and Iraq agreeing to limit production and sticking to it, there has been problems in the past. We will hear news of proceedings at the 4pm press conference.

I would also keep a close eye on trade negotiations between the US and China. Australia is heavily reliant on raw material export to China. Trump has stated his attention to substantially limit trade with China. This has the potential to write trillions off both country’s GDP. If the world’s two largest economies are at logger heads it could have serious implications for the Australian Dollar.

If  you have a currency trade to perform it is vital to be in touch with an experienced broker. The timing of your trade can be crucial during such volatile  times, If you have an experienced broker on board he/she can keep you up to date with what is happening in the market to help you make an informed decision.  I will be happy to help you personally. If you inform me of the the currency pair you are trading, volume and time scale and I will provide a free trading strategy to suit your needs. I work for one of the top brokerages in the country, foreign currency Direct PLC and as such I am in a position to better virtually every competitors rate of exchange. You would also be looking at saving anything up to 4% in comparison to high street banks. Please do get in touch by contacting me at dcj@currencies.co.uk. Thank you for reading my blog.

Further volitlity expected for GBPAUD exchange rates

News broke yesterday that UK remain lawyers have found another loop hole that they are going to try to explore. Theresa May wants to invoke Article50 in March and will argue her case in the Supreme Court earlier December. However UK lawyers are now exclaiming regardless of the result the UK also need to trigger Article 127 alongside Article 50 if the UK want to leave the single market.

I am not surprised that the closer we get to the turn of the year, barriers are forming in front of Theresa May and I wouldn’t be surprised to see Brexit negotiations continue way into 2017. If pro ‘remainers’ manage to keep the UK in the signal market throughout 2017 exchange rates could improve towards the 2 level that we became accustom to in 2015. However if Mrs May gets her way a fall to the low 1.50s is on the cards.

Data releases that will have an impact on GBPAUD exchange rates tomorrow are:

  • AUD Private sector Credit 00:30
  • AUD Building Permits 00:30
  • GBP Financial stability report 10:30

If you are trading Australian dollars in the next 6 months I would strongly recommend getting in contact to discuss your situation. The company I work offers a proactive service to offering economic information whilst having the ability to offer award winning exchange rates. Feel free to email me with your requirements along with the timescales you are working to and I will respond with my forecast and the process of using our company. My direct email address is drl@currencies.co.uk.

GBP/AUD Rates Fall During Monday’s Trading (Matthew Vassallo)

GBP/AUD rates have fallen during Monday’s trading, with the pair falling back below 1.66 at today’s low. The Pound has performed well of late, making again against all the major currencies, including the AUD.

The reason the Pound has prospered is due to a number of factors. Donald Trump’s now infamous election victory boosted the hope of a trade deal between the UK and the US, news which immediately brought back some investor confidence back to the UK, despite our impending Brexit. This positive feeling was solidified by a strong run of economic data, in particular last week’s UK Retail Sales figures, which came in well above market expectation. This is key as any figure release outside of the expected remit, is always likely to drive the market and increase volatility on exchange rates.

Finally, we had the Autumn budget and UK Chancellor Philip Hammond sent out mixed messages but with the initial focus on additional housing and digital infrastructure, the Pound continued its run, putting pressure on 1.70. This run came to an end at the back end of last week and retracted further today as investors started to focus on the negative aspects of last week’s budget, including a predicted 122bn debt in the period running until 2020.

This reaction has in turn boosted the AUD’s value and it is likely it will now find support under 1.70 on the exchange. The AUD has benefitted itself from an upturn in economic conditions in Australia and as such, the AUD has found sustainable market support against the Pound over recent months.

Personally, I would not risk gambling on the current market, with economic conditions in the UK on a knife edge and huge scope for AUD weakness when you consider the recent history on the pair.

Looking ahead and this week we have the Bank of England’s (BoE) Financial Stability Report on Wednesday, which will give us a key insight into the current health of the UK economy. Thursday we have UK PMI Manufacturing data, which came out below market expectation last month and overnight we then have the latest Australian Retail Sales figures, which will be monitored closley by investors.

If you have an upcoming GBP or AUD currency exchange to make and you are concerned by the increased market volatility of late, it may be wise to look at protecting the gains you’ve made, or limiting your losses with one of our forward contracts, rather than gamble on what has become an increasingly volatile and unpredictable market.

If you would like to be kept up to date with all the latest market movements ahead of your currency exchange, or simply wish to compare our award-winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 787 478 and ask one of the team for Matt. Alternatively, I can be emailed directly on mtv@currencies.co.uk

Why is the United States having a major impact on the Australian Dollar? (Dayle Littlejohn)

In recent weeks  the Australian dollar has been losing value and has now dropped to a 5 month low against the US dollar because of the appointment of Donald Trump as President-Elect.

Mr Trumps outbursts about China and future trade agreements puts pressure on commodity currencies that heavily rely on the 2nd largest economy.  Furthermore China’s last round of stimulus is coming to an end therefore a slowdown is expected for China and therefore the Australian dollar. If this is the case I expect commodity prices to fall.

Next month the US will release their latest interest rate decision and its widely expected that the FED will raise interest rates. If this is the case I expect to see a sell off of Australian dollar to buy US dollars and consequently AUDUSD will break through 5 month lows.

GBPAUD forecast

In recent weeks GBPAUD has increased 10 cents. With the US likely to hike interest rates and a slow down in China I believe the Australian dollar will continue to fall against sterling. For Australian dollar buyers there is a good chance exchange rates will continue to improve for the remainder of the year.

However  Brexit negotiations and the Supreme court ruling early next year will put pressure on the pound and then we could see a reverse in exchange rates. For Australian dollar buyers within the next 6 months I would recommend trading this year and banking the Australian dollars now.

If you do not have all of your sterling available you can lock into exchange rates now and pay later by using a small deposit. This is known as a forward contract.

If you are trading Australian dollars in the next 6 months I would strongly recommend getting in contact to discuss your situation. The company I work offers a proactive service to offering economic information whilst having the ability to offer award winning exchange rates. Feel free to email me with your requirements along with the timescales you are working to and I will respond with my forecast and the process of using our company.

My direct email address is drl@currencies.co.uk and I will personally respond once I am back at my desk Monday morning. Enjoy the rest of your weekend and I look forward to speaking with you soon.

Will Sterling continue to rise against the Australian Dollar? (Tom Holian)

The Pound has seen huge gains vs the Australian Dollar after hitting a 3 year low only last month. Sterling has gained by over 6% against the Australian Dollar over AUD18,000 on a currency transfer of £200,000 during this time.

The Australian Dollar has weakened against Sterling since the US election and combined with the delay for Article 50 caused by the High Court ruling recently this has helped the Pound make significant gains in such a short pace of time.

The Australian Dollar is heavily influenced by what happens with the Chinese economy as they are their biggest trading partner and with Trump having threatened to increase tariffs on Chinese goods and services entering the US this is another reason for the Aussie Dollar falling vs Sterling.

Commodity prices have also seen some volatility and if prices fall then this often leads to a weakening for the Australian Dollar.

Business investment in Australia has really started to dwindle recently and the amount of money has dropped by AUD$75 billion in the last 3 years alone.

The Australian Dollar is also affected by what happens in the US economy and with the US potentially raising interest rates on 14th December this could mean investors selling off Australian Dollars in favour of the US Dollar which could lead to GBPAUD exchange rates going in an upwards direction.

Having worked in the foreign exchange markets since 2003 for one of the UK’s leading currency brokers I am confident of being able to offer you bank beating exchange rates as well as helping you with the timing of your transfer of funds whether buying or selling Australian Dollars.

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

 

 

Will the Pound continue to climb vs the Aussie Dollar once the commodity price surge fades? (Joseph Wright)

Despite being a bullish week for the Pound overall, its performance against the resilient Aussie Dollar has been hasn’t been so great after surging commodity prices, particularly within iron ore, have boosted the Aussie Dollars value.

Many have been expecting AUD to come under pressure after the election of Trump in the US presidential election earlier this month.

Throughout the year the Aussie has strengthened as the currency has been in high demand due to the high yields within the Australian banking system. But now that a US Fed interest rate hike is looking pretty certain (current bets suggest a 90% chance of a hike in December), many are expecting the Aussie to weaken as investors take their funds out of AUD denominated investments and deposits, and into the US Dollar amongst other currencies considered more secure as interest rates begin to increase globally.

The surging commodity rates have put this expected Aussie weakness on hold at least for now, which has presented those converted AUD into GBP with continued favourable levels at least for now.

Should the bullish run for commodity prices end, I’m expecting a drop in AUD’s value so for those holding Pounds and waiting for the best time to convert them into Aussie Dollars, it may be an idea not to rush into that decision but rather start planning when best to make it, which is where a company like our can be useful.

Not only do we offer award winning exchange rates which will save you money when making the transaction when compared with the typical high street bank, but we assist clients with the timings and offer them a number of different options and approaches which can end up being financially beneficial.

You can email me (Joe) directly on jxw@currencies.co.uk with an outline of your requirement if you would like to discuss it and make use our my experience, and you also get in contact for quote if you would like to compare our rate with your banks/current providers. Just provide me with an outline of your plans and I’ll be back in touch as soon as possible.

GBP/AUD Rates Fall Ahead of UK GDP Figures (Matthew Vassallo)

GBP/AUD rates have fallen during early morning trading, as the markets wait for the release of the latest UK Gross Domestic Product (GDP) figures.

With little economic data out for Australia this week, investors focus has been on the UK and this morning’s release is one of the most important of the month, so expect increased movement on GBP/AUD rates as we head into the weekend.

Sterling has performed well against its AUD counterpart for most of the week and Wednesday’s Autumn budget seemed to bring further confidence back to the UK economy and ultimately the Pound, despite Chancellor’s Philp Hammond’s messages being mixed at best. Despite a commitment to increase spending on housing and digital infrastructure, debt was expected to rise to £122bn in the lead up to 2021.

If these figures are correct then the UK economy is likely to remain under serious pressure over the coming years and as such any on-going Sterling strength against the AUD may be unsustainable.

GBP/AUD rates were creeping closer to 1.70 but after this morning’s drop the pair are now trading under 1.67. This is still extremely attractive levels for those clients selling AUD considering the recent history on the pair but with the Pound gaining a foothold around 1.60, is now the time to sell your AUD positions?

Personally, I would look to remove the uncertainty which has engulfed the current market and with future rate movement proving very difficult to predict due to the UK’s upcoming Brexit, why gamble when you could take advantage of some of the best rates seen over the past five years.

If you have an upcoming GBP or AUD currency exchange to make and you are concerned by the increased market volatility of late, it may be wise to look at protecting the gains you’ve made, or limiting your losses with one of our forward contracts, rather than gamble on what has become an increasingly volatile and unpredictable market.

If you would like to be kept up to date with all the latest market movements ahead of your currency exchange, or simply wish to compare our award-winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 787 478 and ask one of the team for Matt. Alternatively, I can be emailed directly on mtv@currencies.co.uk

 

Sterling Exchange Rates Climb Higher against Australian Dollar (James Lovick)

The pound has slipped against the Australian dollar losing 0.3% although still maintaining the higher ground seen in the last two weeks. Rates for GBP AUD have 1.70 in sight and my view remains that this is likely to be seen.

The pound performed well yesterday after a confident and calm Autumn Statement delivered by Chancellor of the Exchequer Phillip Hammond. This could have been a different story considering the coverage of the very high levels of debt that the government has to service but the fact that economic growth in the UK is expected to be amongst the highest in Europe is helping support sterling.

UK GDP numbers for the third quarter are released tomorrow morning and have the potential to create high volatility. Anything steady or stronger than expected could see the pound rally.

Politics Driving Sterling Exchange Rates

UK mortgage approvals this morning also arrived higher than expected providing another boost for the British economy at a time when the doom and gloom surrounding Brexit has been unsurmountable. It was only today that ex-Prime Minister Tony Blair came out and stated that Brexit is stoppable and peddled more Brexit doom. Hasn’t this man done enough damage?

Like it or not, politics surrounding Brexit and Trump is the order of the day for the sterling exchange rates and the Supreme Court ruling in December on whether Prime Minister Theresa May must consult Parliament to Invoke Article 50 is essential. This event for me carries a sizeable risk for sterling. The markets are likely to perceive a government win at the Supreme Court as a sign of a hard Brexit and the pound would likely fall in this scenario although there are other  potential scenarios as well.

Clients who are holding sterling or dollars are seeing some much better times after all the Brexit uncertainty to date. There may be a little bit further to go for the pound although there will inevitably be more hurdles surrounding Brexit as outline above. The Supreme Court case commences 5th December 2016 and it would pay to consider all your options well before this date which is now fast approaching.

If you have an upcoming currency requirement either buying or selling Australian dollars and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 787 478 and ask one of the team for James. Alternatively, I can be emailed directly on jll@currencies.co.uk

GBP/AUD returns to positive territory after the Autumn Statement offers no surprises, but where to now for the pair? (Joseph Wright)

By the end of yesterday’s trading session the GBP to AUD exchange rate was back in positive territory, trading up by over half a percent by the end of the trading day.

The Pound has gained 5% against the Aussie Dollar over the past month, making the conversion of Pounds into Aussie Dollars much more appealing than in recent months after the Pound has been under pressure since the Brexit vote back in June.

Donald Trump’s presidential election victory in the US has worked against the Aussie Dollar for a number of reasons, and since the election results the Pound has gained 10 cents on the Aussie, making a AUD 200,000 purchase £7,500 cheaper.

Moving forward I’m personally expecting commodity based currencies such as the Aussie Dollar to weaken, as now the US Presidential election is out of the way it’s likely that there will be a hike in interest rates in the US, and therefore investors are likely to move funds into the greenback and away from the riskier commodity currencies as investors will be able to achieve a return on their deposits within currencies that are considered more secure.

Despite my prediction of further Aussie weakness as we go into the new year, I think the Pound is also likely to feel the strain as the Brexit process begins. Prior to the UK chancellor of the exchequer, Philip Hammond’s speech yesterday the UK Prime Minister, Theresa May did once again outline her plans to invoke Article 50 next year. Do expect the Pound is react negatively to any talk of a ‘Hard’ or early Brexit.

There were no surprises during yesterday’s Autumn Statement and although the Pound was unmoved during the speech, afterwards the Pound did get a boost across the board.

Interestingly this week, Westpac (a major Australian Bank) have offered price targets on the GBP/AUD pair suggesting there will be another decline for the Pound, with the pair likely to drop to 1.6250 in the short term which is 6 cents lower than its current level.

If you are planning on making a currency exchange between GBP and AUD, it’s worth your time getting in contact with me on jxw@currencies.co.uk in order to ensure you make a well informed decision on when to make that particular transfer, as well as benefiting from highly competitive exchange rates from one of the UK’s leading foreign currency brokerages. Just provide me with a basic outline of your currency requirement and I will be back in touch with you as soon as possible.