Monthly Archives: January 2017

Iron Ore keeps the Australian Dollar strong against the Pound but for how long? (Tom Holian)

Iron ore has continued to go up for the fourth month in a row which is the longest period of increase since 2012 as demand from China continues to support the commodity market and therefore the Australian Dollar vs Sterling.

The price for the commodity is now the highest in two years but demand is cyclical and to me it is only a matter of time before Chinese demand starts to wane but the question is how long will we have to wait?

With Trump now in his second week as President of the United States he has upset many global leaders with some of his executive orders and with growth slowing in the US I think this will affect what is happening in China and therefore the Australian Dollar in the longer term.

In the meantime however whilst commodity prices remain resilient this could keep the Australian Dollar relatively strong vs Sterling for the time being.

The Pound is in my opinion still heavily undervalued against the Australian Dollar but whilst the uncertainty surrounding the topic of Brexit and Article 50 carries on then it will be difficult to see the Pound make any real significant gains even though UK economic data is going well at the moment.

Next on the agenda globally will be the US Federal interest rate decision due on Wednesday evening and typically whatever happens in the US has a knock on effect on the value of the Australian Dollar.

If you would like to take advantage of these current levels to exchange Australian Dollars and would like to save money on exchange rates compared to using your own bank then contact me directly for further information and a free quote and I look forward to hearing from you.

Having worked in the foreign exchange markets since 2003 I am confident that I can also help you with the timing of your transfer and make the whole process simple and stress free.

Tom Holian teh@currencies.co.uk

 

 

The influence of Trump on the Australian Dollar vs Sterling (Tom Holian)

Sterling vs the Australian Dollar has started to recover since the inauguration of Donald Trump last Friday as global investors are not yet sure how to react to the next President of the United States.

Typically when there is political uncertainty globally we see a selling off for riskier currencies including the Australian Dollar, New Zealand Dollar and South African Rand. All three currencies are commodity based and this means they typically weaken in times of political uncertainty as evidenced by the week’s movements for GBPAUD exchange rates.

UK GDP for the final quarter of 2016 was released on Thursday and this showed that the UK’s economy has remained resilient in the wake of the uncertainty caused by the Brexit vote back in June.

The UK is predominantly a service based economy and generally speaking the economy has remained rather buoyant over the last few months. It is clear without the Brexit issue dominating the headlines that the Pound would be a lot higher against the Australian Dollar but for the short term at least there are a lot of uncertainties ahead.

One of which is when/if Article 50 will be triggered. The general expectation is that this will take place by the end of March but as yet this has not been confirmed. Indeed, with the Supreme Court verdict confirming that the UK government will need to seek parliamentary approval there are still some obstacles ahead. The majority of MPs voted to remain part of the European Union even though the public vote was in favour of leaving.

Therefore, there is still an uncertain future for Sterling so although the UK economy is performing well it is not clear how the discussions will go.

Therefore, if you have a transfer to make in the weeks or months ahead involving Sterling and the Australian Dollar and you’re worried about what may happen to exchange rates it may be worth looking at buying a forward contract which allows you to fix an exchange rate for a future date. This is useful when planning budgets for that big move.

I have personally worked for one of the UK’s leading currency brokers for almost 15 years so if you have a currency transfer to make and would like to save money when buying or selling Australian Dollars 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

 

 

GBPAUD rates slip from the recent highs, what can we expect next?

The pound to Australian dollar rate has been very volatile this year hitting fresh highs over 1.70. The recent slide in the value of the pound however has seen GBPAUD slip to almost below 1.60 but we have rebounded back to 1.67. Most analysts believe the uncertainty over Brexit will continue in the interim period which will only cause further problems for anyone holding the pound and looking to buy a foreign currency.

The outlook for the pound remains rather worrying which could see the rate easily slip back below 1.60 in time. I personally expect uncertainty over the Brexit will continue to be a feature on the pound and if you are looking to buy Aussie dollars capitalising on the spikes is the best way forward to avoid future uncertainty.

Most clients are looking to buy Aussie dollars at improved rates hoping the market will favour them but they fail to take account that the 7 cents improvement since last week is unlikely to be sustained. The Australian dollar has weakened in anticipation of the market not raising interest rates as quickly as some had hoped. In my expectations the rates are looking very attractive for AUD buyers, holding on hoping for further improvements could be a very costly venture.

If you are planning to buy or sell Australian dollars recent events have presented an excellent opportunity that might not last. For more information on the latest trends and an exchange rate I am positive will save you money please email Jonathan at jmw@currencies.co.uk

Forecast for GBP/AUD Rates – Where Next for the Pound? (Matthew Vassallo)

Those clients holding Sterling will have been pleased with the improvements they’ve seen over the past 10 days, with the Pound gaining almost seven cents from the low.

GBP/AUD rates are now trading around 1.67, providing clients with an AUD currency requirement some much needed respite.

This improvement has come in line with UK Prime Minister Theresa May’s Brexit speech last week and a far more softened tone regarding future relations with the EU, following the supposed triggering of Article 50 in March.

We have also had this week’s decision by the Supreme Court, which backed the High Court’s ruling. It means Article 50 must be ratified by MP’s before any official process to leave the EU can begin. This was priced in by investors ahead of time and was likely a big part of the reason that we have seen aggressive Sterling strength, as it likely means a softer Brexit than many first anticipated.

Personally, I think the markets were crying out for some solid information after basing their decisions on rumours and guess work and whilst I don’t expect the current Sterling strength to continue at the same pace, it may be wise to protect any AUD positions.

The AUD is still trading at some of the best levels of the past five years and is, in my opinion, over-valued against the Pound. The AUD has gained a huge amount of value over the past six months but this has as much to do with the complete lack of investor confidence in the UK economy, rather than an overriding one in the Australian.

The AUD has been the benefactor of this but the Reserve Bank of Australia (RBA) are unlikely to be pleased with such a strong dollar, as it will have a detrimental effect on their export industry. China is facing huge tax tariffs from the US following Trumps Presidential appointment and any slowdown in the Chinese economy, Australia’s largest trading partner, is likely to have a negative effect on the AUD.

As regular readers will know this is such a key component of their economy that any slowdown in this sector will hit them hard, as we witnessed following the unprecedented levels on GBP/AUD around 2010 (1.40).

We also had some better than expected Gross Domestic Product (GDP) figures for the UK this morning and again this is likely to increase confidence in the UK economy and the Pound could be boosted as a result.

This leads me to the conclusion that the downside risk for those clients holding AUD outweighs the upside gains and as such I would be tempted to lock in any short to medium-term AUD/GBP currency transfers and remove any risk from this unpredictable and fragile market.

If you have an upcoming currency transfer to make and are concerned about the current market instability, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact us on 0044 1494 725 353 and ask one of the team for Matt.

Alternatively, I can be emailed directly on mtv@currencies.co.uk and can answer any queries you have about the current market trends & forecasts.

Could Sterling hit 1.70 against the Australian Dollar this month? (Tom Holian)

Sterling has continued its recent fight back vs the Australian Dollar and has gone from strength to strength during the last fortnight against a number of major currencies.

The positive movement for Sterling began when Prime Minister Theresa May spoke out about the issue of Brexit and stated that she would seek parliamentary approval in order to go forward.

The Supreme Court on Tuesday finally gave its verdict but with Theresa May having already spoken out the impact of the news was not as important as it could have been.

Turning the focus to what is happening globally we have seen Donald Trump inaugurated last Friday and he is now in the White House for his first full week.

This has caused global markets to remain anxious and this has caused investors to sell off more riskier currencies which includes the Australian Dollar. This has seen GBPAUD rates improve by over 3% during the last fortnight.

Indeed, yesterday the inflation level in Australia fell which is likely to put more pressure on the Reserve Bank of Australia as falling inflation creates an argument to cut interest rates and if this does become a discussion topic then this is also likely to see problems ahead for the Australian Dollar.

To me the Pound vs the Australian Dollar is heavily under valued and if you remove the Brexit issue we would see GBPAUD rates much higher than where we currently stand. However, in the UK things are still politically uncertain so although I think we’ll see Sterling improve against the Australian Dollar in the short term it is difficult to see what may happen longer term.

Having worked in the foreign exchange industry since 2003 for one of the UK’s leading currency brokers I am confident that not only can I offer you better exchange rates than using your own bank but also help you with the timing of your transfer.

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

Tom Holian teh@currencies.co.uk

 

 

GBP/AUD rates boosted from Supreme Court decision (Joshua Privett)

The results from the long awaited Supreme Court Decision in the UK has seen Australian Dollar buyers as the biggest winners on the exchange rates, with GBP/AUD climbing over two cents between the high and the low of the day.

So after such a highly anticipated event, what next?

We now have the framework established for the Brexit negotiations moving forward. The improvement in Sterling was the result of increased confidence in the currency markets to invest in the Pound. With Parliament likely delaying proceedings, and reigning in any extreme measures which a Government could do if it was acting alone, confidence to buy the Pound with the ability to sell before being caught by any chock surprises is much higher.

Essentially markets are now less nervousness than the first 6 months following the Referendum, where multiple dates recorded heavy falls on GBP/AUD exchange rates.

The deciding factor for the value of the Pound moving forward will be how well Theresa May works with her Parliament, and the degree of independence in her decision making – we will get an idea of this in the coming week.

We can expect strong arguments over access to the single market following the tone on PMQ’s today, so AUD buyers should be wary that sudden falls on GBP/AUD may occur as this market is still very reactive to such rhetoric. The last time Theresa May conducted an interview, GBP/AUD was actually one of the largest losers, falling by 2.4% in a single day.

With the risk there and a much better rate to purchase on the table, there is a very strong argument for anyone planning a foreign currency transfer into Australian Dollars to move sooner rather than later to secure these gains. This was the major positive news for the Pound this month. Now it is simply a rocky road towards Article 50.

It goes without saying that Australian Dollar sellers looking to buy Sterling are not facing the same rush, and opportunities are expected to present themselves in the short and medium term as we edge closer to Article 50.

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

Supreme Court Ruling does little to move GBP/AUD (Daniel Johnson)

Supreme Court Ruling could hinder May’s Brexit plans

Yesterday saw the release for the supreme court judgement on whether parliament will vote on the triggering of article 50. It was very difficult to predict which way the market would move when the result came through. Theresa May’s speech recently made it clear her intention was for a hard brexit, which could be seen as detrimental to the UK economy and many would expect Sterling to suffer against the Australian Dollar as a result.

Sterling actually strengthened against the majority of major currencies following the release of her plans for Brexit. The markets do not react well to uncertainty, with May’s announcement it proves that bad news is better than no news.  The supreme court ruling has now given parliament the right to vote on the exit bill, the big question is whether May’s plans to leave the single market and the customs union will be approved. Labour are sure to try and throw a spanner in the works. It seems the ruling has created more unanswered questions and that is why we have yet to see a significant rally by the pound. There is sure to be volatility over the coming months.

Interest Rate Hikes in the US could cause the Australian Dollar to suffer

The Federal Reserve increased interest rates in December and forward guidance has indicated there could be as many as three more in 2017. This has caused the Australian Dollar to become less attractive to investors. With higher levels of return than previously in the US and the fact that the US Dollar is now considered a safe haven it would not surprise me to see many investors moving toward the US dollar as apposed to the Australian Dollar. This could be even more significant if Australia lose it’s AAA rating.

If you have a currency requirement I will be happy to assist. I specialise in property and I can ensure the whole money transfer process runs efficiently,smoothly and is cost efficient. I can provide an individual trading strategy to suit your needs and I also have access to the best rates of exchange available. I work for Foreign Currency Direct PLC, you can trade in confidence knowing we have been doing this for more than sixteen years. If you would like my free assistance I can be contacted at dcj@currencies.co.uk.

Daniel Johnson

 

 

Where next for GBPAUD exchange rates (Dayle Littlejohn)

Throughout the last 30 days of trading GBPAUD exchange rates have fluctuated 10 cents which means a 200,000 Australian dollar purchase could have been £7,300 cheaper if timed to perfection. For exchange rates to fluctuate 10 cents in 30 days it just shows how volatile GBPAUD exchange are at present and I put this down to Brexit and Donald Trump.

The Supreme Court today confirmed Theresa May’s government does not have the power to invoke Article50 of the Lisbon treaty and therefore she needs to attain Parliamentary approval before any decision is made. You would have thought the pound would have made gains against the Australian dollar as triggering Article50 became more difficult for the PM, however central exchange rates barely moved from 1.65.

Mrs May’s team confirmed that they have a bill prepared and plan to provide this bill to MPs to vote on shortly. There are some MPs that are against Mrs May’s plans, however they are heavily outnumbered.  MPs should come to a conclusion within the next 2 weeks which means Brexit could actually happen in March as May has outlined.

If you rewind back to October when the UK Public were under the impression leaving the EU also meant leaving the single market, exchange rates dropped to 3 year lows and exchange rates fluctuated in the higher 1.50s. My personal view is as long as Donald Trump stays quiet GBPAUD exchange rates will fall back to the high 1.50s by March.

If you are trading GBPAUD in the upcoming weeks, months or years feel free to email me with the reason for your conversion (company invoice, buying a property) and the timescales you are working to and I will email you with my forecast and the process of using our company drl@currencies.co.uk.

** If you are already using a brokerage and would like to know if you are receiving the best rates possible email me with the exact figures and I will reply with our live price. This will take you minutes and in the past I have saved clients thousands! **

 

Sterling Australian Dollar exchange rates due for a volatile day today? Supreme Court decision due out today! (Daniel Wright)

The long awaited Supreme Court hearing decision in the U.K is due out later this morning, which many expect  to cause a fair amount of market volatility, not only for the Pound but for global markets as a whole.

Since this all started in December, the markets have been watching and waiting for any hint as to which way that the decision may go, as it will have a great impact on the Pound and where it heads next due to the influence it may have on a ‘hard’ or ‘soft’ brexit.

Should the Supreme Court overturn the high court decision and say that Theresa May and the Government are good to proceed with moving forward on article 50 (starting the process of brexit officially) then there is the chance that Sterling may drop off a little, but also to show another argument it may lead to Sterling strength as we will finally have a little certainty as to where the U.K heads with all of this.

The expectation is for the decision to confirm that they are upholding the High Courts initial decision and that May will have to put the decision through Parliament. If this is the case then more uncertainty may give the Pound a little drop off but what we hear afterwards could push it back up as I would be surprised if we do not hear a lot of the MP’s asking for a softer approach to brexit which may leave access to the single market.

All in all this could be a very busy day for Sterling/Australian Dollar exchange rates so you need to make sure you are watching the markets at all times, or that you take advantage of limit orders. If your current broker or bank has not made you aware of this handy tool then this is something that we offer. A limit order is where you can set a particular rate trigger in the market that you would like to achieve,  and should it become available any time 24 hours a day 7 days a week then your rate will be bought out automatically for you. There is no cost to place this order and it can be cancelled or amended at anytime with a quick phone call to us.

If this seems of interest or you would like to make an enquiry about our award winning service and exchange rates anyway then it will be well worth you contact me personally. You can email me (Daniel Wright) on djw@currencies.co.uk with a description of your needs and I will call you personally to discuss the options available to you and to explain how it all works.

Has the Pound already experienced it’s worst levels this year? (Joseph Wright)

The Pound has continued to benefit from both the clearer Brexit plans and Trumps inauguration, with the currency gaining by almost 1% against the Aussie Dollar during today’s trading session.

The reasoning behind the Pound’s gains can be put down to uncertainty. Sterling had been struggling since the turn of the year as foreign exchange markets were unaware of the UK governments Brexit plans, additionally many feared that the government  would opt for a ‘Hard Brexit’ whereby the government would look to focus more on controlling immigration and not retaining access to the EU’s single market.

These fears were put to rest last Tuesday as the UK Prime Minister, Theresa May gave a Brexit focused speech. During this speech it was announced the any final Brexit deals will be passed through parliament, and straight away the Pound rocketed upward and actually gained against the US Dollar by it’s biggest margin since 2008.

Another reason behind the Pounds turn in fortunes can be put down to events outside of both the UK and Australia. Donald Trump has now been sworn in as the US President, and despite a US focus he has had kind words to say about the UK and the special relationship between the Countries.

Furthermore, his policies have put the foreign exchange markets on edge as many have opted to hold funds in safe haven currencies as opposed to riskier currencies, such as AUD.

Moving forward I expect to see Sterling continue to recover against AUD, although early tomorrow morning could create a major stumbling block.

At 9.30 am the Supreme Court’s ruling on whether or not the UK government require parliamentary approval before formally beginning the Brexit will be announced. This could create major volatility between GBP exchange rates so feel free to get in touch if you wish to be kept up to date with this announcement, as well as other similar developments.

If you are planning to make a currency exchange involving the Pound and AUD, it’s well be 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.