Monthly Archives: December 2016

GBP AUD Breaks over 1.70 again in Christmas Run Up (James Lovick)

GBP AUD exchange rates are back over 1.70 for this pair although rates are struggling to climb much higher with some resistance at these higher levels. UK Gross Domestic Product (GDP) figures are released on Friday morning and could make for an interesting end to the week just before Christmas.

Expectation for GDP is for a figure of 0.5% on the quarter and 2.3% on the year. GDP has been extremely resilient following the British referendum to leave the European Union 23rd June 2016. We are now some 6 months on and to date not that much has changed which is one of the reasons the pound has seen a boost over the last 6 weeks.

Next year will be hugely interesting though not just to see the impact on the price of sterling by political developments but also to see how the Aussie dollar performs.

The Australian dollar looks set for an extremely volatile 2017. There is talk that Australia may see a credit rating downgrade from Standard & Poor, one of the major credit rating agencies. Government budget deficits expected to occur next year are also likely to put pressure on the dollar. There could be some better opportunities to buy Australian dollars next year on a weaker Australian economy.

The direction and policies of Donald Trump towards world trade will also have a direct impact on the Aussie and this element should be seriously considered. Any slowdown in China could see a knock on effect of Australian dollar weakness in the New Year.

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 Outlook – Short to Medium Term (Daniel Johnson)

Pound Forecast

There are several key factors that are currently influencing the value of GBP/AUD.  The main factor would be Brexit. The high court ruling as to whether the government will vote on the triggering of article 50 is due to finish in early January. This will give a clear indication s to whether

the UK’s exit from the EU will be a hard or soft or hard brexit. A hard brexit will surely cause significant pound weakness. I personally feel that a soft brexit is the more likely and the more sensible.

The recent US interest rate hike has seen the Australian Dollar become a less attractive destination for investors. The US dollar is considered as a safe haven investment and now with the promise of higher returns it is becoming the investors choice. It is also predicted there could be as many as three more hikes in the US by the end of 2017. Australian economic data is also not coming through as positive as it has been and Chinese growth is dwindling.

If  you have a currency requirement it is crucial to be in touch with an experienced broker. The timing of your trade is vital 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. Should you find our information useful and you would like me to assist with your trade 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 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.

What to expect for Australian dollar buyers and sellers (Dayle Littlejohn)

In recent weeks the Australian dollar has been taking a hit and many economists believe this trend will continue throughout 2017.

At present investment remains in Australia as interest rates remain high. However with forecasters suggesting that inflation will remain low this could force the Reserve Bank of Australia to cut interest rates early next year, which would lead to an Australia dollar sell off.

Couple this with the US Federal Reserve deciding to hike interest rates to 0.75% from 0.5% Wednesday evening, throughout next year I wouldn’t be surprised to see investors move out of the Australian dollar and into the US dollar.

Another factor this could lead to further Australian dollar weakness next year is the slowdown in China. Forecasters believe growth will slow to 6.4% down from 6.7% in 2016.

If you are buying or selling Australian dollars in the upcoming months and want to achieve rates of exchange that are better than your bank, whilst receiving regular economic information feel free to email me with the currency pair (AUDGBP, AUDEUR, AUDUSD) the reason for the transfer (company invoice, property purchase) the timescales you are working to and I will respond with my forecast and the process of converting currency. My direct email address is drl@currencies.co.uk and I look forward to receiving your email.

Buying Australian Dollars improve ahead of thin Christmas trading to begin next week (Joshua Privett)

Buying Australian Dollar rates have shown a marked improvement ahead of the Christmas period with the ‘magic’ level of 1.70 being broken for the second time since the absolute lows of October.

The gains against the Australian Dollar this week were due to a lower demand for AUD which sucked away some of its recent, and frankly over-inflated, value. The reason behind the rise is attributed to the historic rise in interest rates in the US, only its second time the FED have been do so since the financial crisis.

The interest rate on the Australian Dollar is at record lows but still much higher than elsewhere at 1.5%, compared to the UK’s at 0.25% for example. However, it is traditionally seen as an unstable currency, so when you have a safe-haven currency which raises its base rate, investors like to opt for this safer option, and the sell-off of Aussies for US Dollars is why USD/AUD gained today, as well as GBP/AUD.

Moving forward however, Australian Dollar buyers have the phenomenon of profit taking to deal with as unusual end of year market forces take hold of exchange rates over the next few weeks.

At the end of the year traders and companies wind down their positions in order to consolidate their profits in a stable currency to avoid coming back to their desks in January and finding outside forces have eaten away some of its value. Of course the Pound is seen as anything but stable at the moment.

As such anyone with a buying Australian Dollar requirement may be wise to move sooner rather than later to avoid the hefty amount of risk which should be piled onto Sterling in the very near term.

Since Trump became President in November, AUD buyers have gained over 10 cents in the marketplace. Meaning that on a £100,000 transfer you have gained an additional $10,000 in the space of 6 weeks. Understandably, the popular option at the moment is to consolidate those gains.

The turn of the New Year has many forks in the UK and therefore the Pound between January and March which are difficult to account for ahead of time, and markets will be factoring this in to the price of Sterling moving forward.

Sterling buyers of course may consider the opposite and play the currency markets by ear as we edge closer to the Christmas period to try at catch the market at any peaks which emerge.

If you are planning to make a currency exchange involving the Pound and another foreign currency, it’s well be worth your time getting in contact with me on jjp@currencies.co.uk over the weekend 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.

I have never had an issue beating the rates of exchange on offer elsewhere, so a brief conversation could save you thousands on a prospective transfer.

What will be the big news on GBPAUD exchange rates?

GBPAUD exchange rates have improved as the pound finds favour on the back of an improved outlook for sterling exchange rates and the UK economy. Most analysts now expect the pound to be stronger in the coming weeks and months as investors look to invest their money in a much more stable and potentially profitable currency and country. Most suggestions indicate the UK will no longer be engaging in a hard Brexit which would see the UK sever all ties with the EU including access to the single market. This has helped the pound rise but is it guaranteed?

If you have any currency requirements to buy Australian dollars then you might find it could become more expensive in the future if the Supreme Court decision throws out the government’s case that they will be able to enact Article 50 under Royal Prerogative powers. If the government is allowed to act without parliamentary approval the pound could end up much lower. If the case is upheld then the pound could rise higher but I do feel much of the good news is already priced in.

GBPAUD rates have fallen dramatically but just lately we have had an excellent improvement of almost ten cents presenting some of the best levels to buy the Australian currency in almost 2 months. If you are looking to make any GBPAUD currency transactions in the coming weeks and months then please speak to me Jonathan about the latest news and trends to be kept up to date. For more information please email me Jonathan on jmw@currencies.co.uk

 

Will the Pound Climb Higher against the Australian Dollar? (James Lovick)

The pound has seen a good rally over the last four weeks against the Australian dollar which has largely come about by the Trump election victory. In my view this very much opens the door for a trade agreement between Britain and the US whilst also giving other options in the Brexit negotiations which perhaps weren’t available before under the Obama administration. These options for trade probably wouldn’t be around with a Clinton administration either. However the Trump benefits seem to be wearing off for sterling exchange rates and the pound is hitting resistance at these higher levels – Those Brexit jitters are for the moment keeping a lid on the price of sterling.

GBP AUD may have a little further to go through considering the US Federal Reserve raised interest rates by 0.25% last night. This is likely to result in flows of funds returning to the US where interest rates are now higher and the likes of the Aussie and kiwi may reduce in value. The Fed have signalled there may be three rate hikes in 2017 so this is going to become extremely topical.

For this reason those clients needing to sell Australian dollars would be wise to take this into account as the dollar could weaken further. However those client selling Australian dollars could be in luck if the British government should win the appeal surrounding Brexit at the Supreme Court where a verdict is due in January. This in my view would result in  a fairly big fall in the value of the pound presenting another excellent opportunity to sell dollars.

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

Sterling vs the Australian Dollar could hit 1.70 tonight if the US Federal Reserve increase interest rates (Tom Holian)

Rates to buy Australian Dollars have been flirting either side of 1.70 recently in anticipation of the US Federal Reserve raising interest rates at tonight’s meeting.

Typically when the US raises interest rates this results in US Dollar strength and weakens riskier commodity based currencies as global investors plough into the US Dollar.

With the chances of an interest rate hike approximately 95% it appears as though this is a foregone conclusion but as the Fed have been rather cautious during 2016 as far as raising interest rates I think when they finally confirm the action tonight then this could see GBPAUD rates break through 1.70.

The Australian economy has been wobbling recently and showing signs of a slowdown with GDP hitting its lowest level since 2011 last week. Clearly the issues surrounding a ‘soft’ or a ‘hard’ Brexit have been weighing heavily on Sterling vs Australian Dollar exchange rates and I think tonight’s decision could be the catalyst for Sterling strength.

Australian unemployment data is due out overnight and with GDP having fallen recently I would not be surprised to see this data coming out worse than the estimate of 5.6%.

Tomorrow afternoon the Bank of England will announce their latest interest rate decision and although I don’t expect any change in policy any positive comments by governor Mark Carney may see Sterling go in an upwards direction.

Clients looking to sell Australian Dollars to buy Sterling in the future may wish to consider buying a forward contract which allows you to fix an exchange rate for a future date.

Having worked in the foreign exchange industry since 2003 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 currency.

If you have a currency transfer to make and would like to save money when buying or selling Australian Dollars then feel free to contact me directly for a free quote and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

 

 

How will the US Interest Rate Decision effect the Australian Dollar? (Daniel Johnson)

High Probability of Rate Hike in the US

Last December, Janet Yellen the Chair Lady for the Federal Reserve indicated there could be as many as four rate hikes during 2016. None of which are yet to materialise. Although the Fed is meant to operate as a separate entity to the government and not base it’s decision on politics I am confident the uncertainty surrounding who would become Presidency may have held them back in hiking rates.

Now Trump has gained power, he has made it clear he is in favour of several hikes this year. He has also put pressure on Yellen to raise rates, going as far as to threaten her position if no action is taken.

It is almost a certainty that the US will raise rates today, either by 0.25% or 0.5%. 0.25% is widely predicted so this outcome will already have influenced current exchange rates. If it is raised by 0.5% however expect more volatility on the markets. The Aussie is likely to weaken as investors leave the Aussie for the safe haven of the US Dollar. If you are selling Australian Dollar I think it would be wise to move before today’s interest decision.

If  you have a currency requirement it is crucial to be in touch with an experienced broker. The timing of your trade is vital during such volatile  times, If you have an experienced broker on board they can keep you up to date with what is happening in the market to help you make an informed decision. If you would like me to assist with your trade 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 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.

 

Buying Australian Dollar rates relatively stagnant ahead of US interest rate decision (Joshua Privett)

Buying Australian Dollar rates have remained relatively stable following a sudden reversal in some of the Pound’s recent gains on Wednesday of this week.

The Pound has been pressurized once more this week however, with a live court case in the Supreme Court as the Government appeals the decision of the Judicial Court in November, with uncertainty over the direction of the Brexit weighing heavily on the Pound once more.

The frenzy of investors flowing into Sterling was the result of the previous Judicial decision which meant Government had to consult Parliament through the Brexit process. This jump in Sterling’s value due to increased demand was attributed to the high expectation that Parliament’s involvement in the process itself would yield a longer time-frame for the UK to enact a Brexit, alongside the likelihood that MP’s would push to retain closer economic ties with the EU.

This renewed uncertainty is what has caused Sterling to lose some of its recent strength.

Moving forward the US interest rate decision on Wednesday next week will likely provide a further boon for AUD buyers.

The Australian Dollar enjoys hefty demand due to the high level of interest available compared to other major currencies. Currently this stacks up at 1.5% compared to 0.25% in the UK and 0.5% in the US for example.

However, the US, following a succession of staggering performance figures released in their economy in recent months, despite the uncertainty surrounding their recent election, it seems likely that the US will be raising theirs next Wednesday to 0.75% barring any surprises.

The expectation is that if a stable currency is offering 0.75% interest, compared to an unstable Australian Dollar which yields 1.5%, then many investors will choose to leave the Australian Dollar and opt instead to secure US Dollars, with the AUD becoming cheaper with any mass sell off which ensues.

In the medium term however, the Pound is expected to take what could be quite a serious hammering due to speculative profit taking by high street traders which is set to take place in the latter part of December. Thus Australian Dollar buyers may see a ‘sweet spot’ emerging on GBP/AUD over the next week or so.

In these instances it is best to be in a position to move fairly quickly in case any tempting opportunities emerge, and the well informed purchaser will certainly have an advantage to avoid being ‘last to the party’ and being forced to accept a rate of exchange below any premium which is reached.

I am in a position to offer a proactive service to help my customers in timing their transfers, particularly during these volatile periods, in order to secure desirable exchange rates. I work for one of the UK’s leading brokerages with the average tenure of our dealer’s being in excess of 8 years in this job – longer than most companies in their entirety – so I am ideally placed to secure the most competitive rates and have never had an issue beating the rates of exchange on offer elsewhere for GBP/AUD. Simply contact me over the weekend on jjp@currencies.co.uk and I will respond as soon as I am able.

Similarly if you are looking to be buying Sterling, as my article points out there are likely to be further opportunities for you later in the month with a cheaper Pound, so you can contact me to discuss the options open to you to monitor the markets and secure a desired exchange rate.

I have never had an issue beating the rates of exchange on offer elsewhere, so a brief conversation could save you thousands on a prospective transfer.

US Federal Reserve could cause Australian Dollar weakness (Tom Holian)

Sterling vs the Australian Dollar has had a mixed week in spite of Australian GDP falling for the first time in 4 years.

Australia has been one of the only countries in recent years to a avoid a recession and has prospered by having interest rates higher than those available in many other strong economies.

However, with the RBA having cut rates twice this year and with the US Federal Reserve due to meet next Wednesday we could see the AUD weakening if the Fed choose to increase interest rates.

I personally think the Fed have been ready to do this for months and with the US election now out of the way I think it’s almost a foregone conclusion.

Typically this sees US Dollar strength as global investors sell off riskier currencies including the Australian Dollar to invest in the US.

Therefore, if the Fed do raise interest rates I expect to see the Pound make gains vs the Australian Dollar and this could see rates challenge 1.70 during the middle part of the week.

On Tuesday morning the UK publishes inflation data and if we see a rise I also think we could see Sterling strengthening vs the Aussie Dollar.

The ongoing Brexit issue continues to dominate the headlines and we are not likely to hear the result of this week’s Supreme Court ruling until early January so expect the volatility for Sterling vs the Australian Dollar to continue.

 

Having worked in the foreign exchange markets since 2003 I am confident that not only can I offer you bank beating exchange rates but also help you with the timing of your transfer of money.

If you need to buy or sell Euros and would like a free quote then contact me directly and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk