Daily Archives: June 6, 2017

How will GBPAUD react to the UK election?

How will the pound perform against the GBPAUD rate is a valid question given the UK election on Thursday which has real potential to move sterling sharply higher or lower. The pound is looking more and more at risk of some big movements as the uncertainty around the actual outcome persists further. The general belief is that Theresa May could win the election with a decent majority but if she fails to sterling could drop, GBPAUD could rise as high as 1.80 or fall back into the 1.60’s. If you have a transfer to make then

Whereas before the UK Referendum last year there was a 1 to 8 chance of a Leave vote winning, now the hung parliament is at odds of 1 to 3 and a Jeremy Corbyn win is at 1 to 5 odds! The general belief is as I say a UK election victory for Theresa May but whereas the previous belief was a strong majority, now we are looking at less chance of the ‘landslide’ that was predicted. If you have a transfer to make then understanding the market and potential movements in the future is key to getting the better deals.

The Australian dollar has been a little stronger on the back of the news of the latest Reserve Bank of Australia news that indicated interest rates could be rising soon in the future possibly to as much as 3% over the next few years. Such a positive outlook helped the Aussie to claw back some ground against the weaker pound and depending on the outcome of the election we could see the rate below 1.70. A strong Theresa May win could however easily push this into the high 1.70’s and even over 1.80.

If you have a transfer to consider and wish to learn more about the market and all of your options then please get in touch. We can help with the planning and execution of any exchange. A limit order is perfect in this kind of market as it guarantees your rate if it is suddenly hit during a period of unexpected movement.

For more information please contact me Jonathan Watson on jmw@currencies.co.uk to discuss how we can help maximise your exchange rate.

The UK Continues to Mourn Terror Attack – How is the Pound Reacting? (Matthew Vassallo)

As the UK continues to mourn Saturday’s horrific terror attacks, the question clients have asked me this week is how the Pound will react to the tragic events?

Whilst the markets may not have responded as aggressively as in the past, terrorism no doubt plays a part in investors thinking, with a lack of confidence around the economy in question usually the likely outcome.

Sterling was already under pressure against the AUD, with the pair moving back towards 1.70. The Pound did find some support yesterday however, with a recovery back toward 1.73 but whether this spike is sustainable or not is questionable at best.

The Pound has been fighting an uphill battle ever since it was announced that the Torries had a 20 point lead over the Labour party and the markets factored in such figures. Every pre-poll since has indicated a surge in support for Labour and with the most recent suggesting the Conservatives were only ahead by three points, has caused inventors to panic and sell-off their Sterling positions.

This in turn has benefited commodity based currencies such as the AUD, which has found plenty of support under 1.75 over the past couple of weeks.

Looking at the Australian economy and with iron ore prices low, this would usually have a detrimental effect on the value of the AUD due to Australia’s heavy reliance on their export industry. However, currently this is seen as the lesser of two the evils by investors and as such I would be taking advantage of the current sell rates if I was holding AUD.

Anyone who has an upcoming Sterling or AUD currency transfer to make can get in touch with us to run through the current market conditions & forecasts. We can assist not only with our award winning exchange rates but also our experienced insight into the current market to help guide you through your currency exchange process.

I am available on 0044 1494 787 478 and you can ask one of the team for Matt. Alternatively, I can be emailed directly on mtv@currencies.co.uk