Monthly Archives: August 2017

GBP AUD Weakness on Lack of Brexit Progress after 3rd Round of Negotiations Conclude (James Lovick)

The pound has fallen lower against the Australian dollar and all of the other major currencies today with a low of 1.6231 seen earlier today for GBP AUD. The Australian dollar has been boosted this week following better than expected construction and building approvals for June highlighting the construction and housing sectors are performing robustly and boding well for the dollar. The Australian dollar could also see added benefit if the price of oil and other commodities continues to rise.

Today’s fall for GBP AUD can largely be attributed to the third round of Brexit negotiations which were concluded today. The tone was less than impressive with no real progress on both the exit bill and potential future trade deal and an awkward press conference between Brexit Secretary David Davis and his counterpart Michel Barnier . The pound is now likely to remain under considerable pressure as the markets now have to wait for a fourth round of discussions later in September whilst this game of bluff continues. The ongoing Brexit continues to be the major driving force for sterling exchange rates and until real clarity is offered then it is difficult to see much improvement for GBP AUD.

For those clients looking to sell Australian dollars in the coming weeks or months then now would be a sensible tm to make contact to look at the options available to you. There may be some more sterling weakness if Brexit negotiations recommence badly in a couple of weeks. A well-timed forward contract will allow you to lock in the rate of exchange at the right time and take the risk out of the volatile currency markets.

Data is light tomorrow with just a commodity index report measuring export prices so eyes now keenly await next Tuesdays Reserve Bank of Australia interest rate decision. Any suggestion of a change in montery policy or perhaps more likely some jawboning are likely to have a material change on the dollar.

If you would like further information on Australian dollar exchange rates or any of the major currencies and to discuss how we can assist 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 Strengthens against AUD on an increase in mortgage approvals (Daniel Johnson)

Mortgage Approvals cause Sterling spike

Yesterday saw the release of UK mortgage approvals data for July which came in above expectations, this was coupled with poor building approvals from down under. Worryingly  however UK house prices have fallen and may continue to do so should inflation remain at high levels and average wage growth continues to lag behind.

The fall in building permit figures is significant down under as in order for the Reserve Bank of Australia (RBA) to justify a hike in interest rates there needs growth in this area.

Iron Ore is Australia’s main export, in high demand from Australia’s biggest trading partner, China. We have seen rapid rises in iron or of late which has benefited the Aussie. However, yesterday saw a small decline and this was another catalyst for Australian Dollar weakness.

Despite this positive data from the UK and negatives from Australia, I am doubtful Sterling’s rally will continue. There are two main factors that need to be addressed in order for Sterling strengthen significantly. We need clarification on Brexit and a stable government.

Political uncertainty historically weakens the currency in question. There are currently a growing number of conservative MPs putting forward a vote of no confidence in Theresa May. She either needs support to be ousted and  replaced quickly if the pound has any chance of significant gains.

The white papers that are being released outlining the UK’s aims in negotiations to leave the EU are only documenting small issues at present and none so far are significant enough to move the markets. The big issues on trade and immigration need to be addressed to provide more clarity to investors.

If you have a currency requirement I would b happy to assist. You need to have an experienced broker on board in order to take advantage of rates when a brief spike occurs, especially in the current climate. If you have a currency provider already in place I am prepared to perform a comparison against them. It will take minutes and could potentially save you hundreds or even thousands of pounds. I can be contacted at  dcj@currencies.co.uk.

Sterling Spikes During Wednesday’s Trading – GBP/AUD Forecast (Matthew Vassallo)

Sterling made some positive inroads against the AUD during Wednesday’s trading, bringing some respite for those clients holding the Pound.

GBP/AUD rates hit a high of 1.6369, gaining two cents at the high. Whilst the AUD is likely to find support under 1.65, it is at least reassuring that Sterling has been able to gain a foothold, especially when you consider how much negative press there has been around the UK economy of late.

Whilst the UK’s on-going Brexit talks continue to dominate headlines, with multiple reports of a disjointed so far unsuccessful approach handicapping any major advances for the Pound, the AUD has run into its own problems this week.

Despite the Australian economy performing admirably of late, there is a growing concern concerns that the potentially unsustainable property price housing bubble that is engulfing Sydney & Melbourne, could soon come to a head.

If interest rates are hiked, as floated by the Reserve Bank of Australia (RBA) in their recent minutes, this could have a detrimental effect on a large number of home owners in two of Australia’s most affluent cities. Whilst the RBA will be aware of the destabilization this could cause, some analysts are arguing that it may be unavoidable if inflation levels suddenly rise at a rapid rate.

Even more poignantly the current saga surrounding the US & North Korea could well be a catalyst for global investor risk appetite to shrink. This in turn could be bad news for the Australian economy and ultimately the AUD, which being a commodity based currency, is heavily reliant on global growth.

Therefore, any slowdown in this sector, in particular in the US economy, could lead to investors will then pull funds away from the riskier currencies such as the AUD and back into safer havens like the CHF or even USD.

This means that commodity currencies are open to larger swings than others and as such I would be looking to take advantage of the very attractive selling levels currently on offer and remove any market risk.

If you have an upcoming GBP or AUD currency transfer to make you can contact me directly on 01494 787 478. We can help guide you through this turbulent market and as a company we have over eighteen years’ experience, in helping our clients achieve the very best exchange rates on any given market.

Our award inning rates can be accessed very easily over the phone and I can keep you posted with key market developments ahead of any prospective exchange you need to make.

Feel free to email me directly on mtv@currencies.co.uk to find out all the options available to you ahead of your currency transfer.

Will Brexit uncertainties limit a Pound to Aussie Dollar recovery? (Joseph Wright)

The Pound to Aussie Dollar exchange rate is currently trading at the top end of its post-brexit vote lows at the moment, with it’s multi-month low sitting at 1.6171.

It has traded in the late 1.50’s since the vote so now is an important time as we’ll see whether the pair will fall below this mark and hit new brexit lows as the Euro has over the past week.

Under normal circumstances I would expect to see future Sterling gains against the Aussie Dollar due to the overheating housing market concerns, as well as the RBA’s reluctance to amend interest rates to counter this but due to fears surrounding the UK economy in future, I’m not expecting to see the Pound recover back to levels of 1.70 – 1.76 that we saw earlier this year.

Many current financial headlines are centered around the Brexit negotiations and how the European Commission is becoming frustrated with the UK’s lack of clarity regarding the exit strategy, with the UK not willing to show its hand until the Brexit Bill is confirmed.

If you would like to be kept updated regarding any short-term price movements involving the Pound and the Aussie Dollar, do feel free to get in touch with me and register your interest, as we’re able to keep clients informed.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

 

Could the Pound fall against the Australian Dollar during September? (Tom Holian)

Sterling vs the Australian Dollar has experienced another difficult week although not as bad as some of the currency pairs for the Pound.

The Pound is continuing to struggle under the weight of the Brexit talks which are clearly not going anywhere at the moment.

Indeed, during August whilst many politicians take their summer break things can get delayed or paused.

Therefore, as we go into next month I think we could see further losses for Sterling coming against the Australian Dollar because I cannot see how the talks will suddenly improve for the UK.

Sterling is now at its lowest level since 2009 to buy Euros and this goes to highlight how weak the Pound is against one of its major currency pairings.

This is why I also think we could see the Pound fall below 1.60 to exchange Sterling into Australian Dollars.

We are also yet to hear of any developments regarding the single market and if you think we have now been in discussion for a few months already with just over a year and a half to go things have not been going well at all.

Therefore, if you need to buy Australian Dollars over the next few weeks it may be worth looking at buying a forward contract which allows you to fix an exchange rate for a future date for a small deposit.

If you have a currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency.

A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Tom Holian) on teh@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Will Brexit uncertainty continue to push GBP/AUD lower, and will we see trade levels below 1.60 again this year? (Joseph Wright)

Economists appear to be concerned by the almost daily dropping of the Pound, as uncertainty surrounding the terms of the Brexit deal are putting alot of pressure on the Pounds value.

Many are predicting that the pound will be trading lower into 2018 than current levels, and although this blog is focused predominantly on the GBP/AUD exchange rate I think it’s useful for our readers to know that many major institutions are predicting that the Pound will fall below parity against the Euro for the first time in 2018.

Interestingly earlier this week the National Australian Bank predicted that the Australian Dollar will actually lose value against the Pound between now and the end of the year, although only marginally.

This prediction appears to buck the trend of general negative outlooks surrounding the pound as concerns over the UK economy as we enter Brexit are generally outweighing other factors.

This weekend there could be movement for the Pound to Aussie Dollar exchange rate as a number of key financial figures such as US Fed Chairlady Janet Yellen and European Central Bank president Mario Draghi will be speaking Jackson Hole central banking conference. This will be happening out of hours so expect any major announcements to impact the rates perhaps late tonight or when markets open next week.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

GBP/AUD Forecast – Will Sterling Suffer Further Losses? (Matthew Vassallo)

The Pound has found little support of late, with investors moving their funds into the higher yielding AUD.

GBP/AUD rates have been marooned below 1.65 for the past few weeks and looking back over a longer period, the Pound is now over 35 cents lower than pre-UK referendum.

The UK economy remains under pressure, with the markets becoming increasingly sceptical regarding the on-going Brexit negotiations.

With reports of a disjointed government and various opinions on how the UK should proceed, it is unlikely in my opinion, that the Pound will make any sustainable inroads against the AUD over the coming days & weeks.

Whilst market conditions can change quickly, I don’t foresee a major upturn in the short-term, with investor confidence in the UK likely to remain minimal. As such, it may be worth protecting the Pound’s current value rather than risk another downward spike below 1.60 against the AUD.

Looking at the Australian economy and whilst the AUD has performed beyond expectation against the Pound, being a commodity based currency it is heavily reliant on global growth.

Therefore, any slowdown in this sector, in particular in the US economy, could lead to global risk appetite shrinking and investors will then pull funds away from the riskier currencies such as the AUD and back into safer havens like the CHF or even USD.

This means that commodity currencies are open to larger swings than others and as such I would be looking to take advantage of the very attractive selling levels currently on offer.

If you have an upcoming GBP or AUD currency transfer to make you can contact me directly on 01494 787 478. We can help guide you through this turbulent market and as a company we have over eighteen years’ experience, in helping our clients achieve the very best exchange rates on any given market.

Our award inning rates can be accessed very easily over the phone and I can keep you posted with key market developments ahead of any prospective exchange you need to make.

Feel free to email me directly on mtv@currencies.co.uk to find out all the options available to you ahead of your currency transfer.

 

US economic conditions causing Australian Dollar strength (Daniel Johnson

 Australian Dollar holds higher appeal due to US economic uncertainty

Investors are favoring higher risk currencies following increasing US political and Federal Reserve uncertainties along with increases in commodity prices.The chances of a Fed rate hike are low due to Trump’s outlandish comments  and commodities are in high demand for investors. This has seen higher demand for commodity based currencies such as  AUD. Australia’s biggest export is  iron ore and it nearly reached $78 a tonne during Friday’s trading, the highest levels we have witnessed since April.

The RBA have tried jawboning, attempting to talk down the value of the Australian Dollar rather than making any drastic changes in monetary policy. It is not having the desired impact and GBP/AUD currently sits in the low 1.60s. The Australian Dollar is performing well against the majority of major currencies and could be set to continue. If investors continue to leave the US dollar in favour of higher returns from the Australian Dollar we could see Sterling suffer further against the Aussie.

Janet Yellen, the head  of the Federal Reserve is speaking at the Jackson Hole Symposium on Friday.The Jackson Hole Symposium is an annual symposium held in Wyoming. It is a forum for central bankers, policy experts and academics to come together and discuss monetary conditions and policies. If she gives  any hints to a rate hike in the US the Aussie is likely to weaken and we could see small gains for Sterling. This is rather clutching at straws however as there is very little reason to think the pound will make large gains.

If you have a currency requirement I would be happy to assist. You need to have an experienced broker on board in order to take advantage of rates when a brief spike occurs, especially in the current climate. If you have a currency provider already in place I am prepared to perform a comparison against them. It will take minutes and could potentially save you hundreds or even thousands of pounds. I can be contacted at  dcj@currencies.co.uk.

 

 

 

AUD Continues to Make Inroads Against Sterling (Matthew Vassallo)

The AUD made further inroads against Sterling overnight, following positive employment data released in Australia.

The International Monetary (IMF) also raised China’s growth forecasts for 2018-2020 to 6.4%, an improvement of 0.4%. With Australia’s close trade to ties to China, any improvement in the Chinese economy inevitably helps boost the AUD’s value.

Sterling has lost almost two cents at its low against the AUD over the past 24 hours, with the pair now trading around 1.62.

The market perception surrounding the UK economy remains weak, with investors extremely sceptical about how Brexit negotiations will develop and the potential negative impact this will have on the UK economy. This is likely to drive market sentiment for the foreseeable future and as such, I am not anticipating a major improvement for the Pound any time soon.

Investors will also be looking towards any developments between the US & North Korea, which is obviously a destabilising global situation.

This is likely to drive global currencies and commodity based assets such as the AUD, could be amongst the hardest hit. Global fear generally means investors will start to pull funds away from riskier, potentially higher yielding currencies such, as the AUD and return them to safer havens such as the CHF or historically the USD.

This means that the AUD could be inadvertently weakened by any increase in the rhetoric surrounding the Korean Peninsula, so clients may wish to consider this ahead of any AUD currency exchanges this week.

Whilst the recent economic data emanating from Australia has been fairly strong, Sterling should find some support above 1.60 over the coming days.

If you have an upcoming GBP or AUD currency transfer to make you can contact me directly on 01494 787 478. We can help guide you through this turbulent market and as a company we have over eighteen years’ experience, in helping our clients achieve the very best exchange rates on any given market.

Our award inning rates can be accessed very easily over the phone and I can keep you posted with key market developments ahead of any prospective exchange you need to make.

Feel free to email me directly on mtv@currencies.co.uk to find out all the options available to you ahead of your currency transfer.

GBP/AUD Forecast Difficult to Judge (Ben Fletcher)

Sterling dropped today after inflation defied expectations and held at the previous level of 2.6%. There was hopes that inflation may rise up to 2.7% however it didn’t happen and the markets responded with Sterling losing a cent against the Australian Dollar. Whilst Sterling has dropped today, in my opinion it didn’t quite go as far as I thought it might. This is due to some of the concerns with the Australian economy which does suggests the Aussie strength is dwindling.

The number of new builds expected in the next few years in Australia looks set to fall which has an effect on the price of housing and the amount of jobs across the country. There is low inflation levels in Australia and despite the Reserve Bank of Australia suggesting they may increase interest rates to 3.5% in the next few years, they wont before inflation rises. This suggests that whilst the GBP/AUD is currently sitting around the mid 1.60’s if good news for Sterling becomes apparent the rate could rise sharply to 1.70.

Unemployment Tomorrow

In the short term there will be Unemployment Data in the early hours of Thursday morning which is expected to show July’s rate has stayed the same as June, however any deviation from this could have a positive or negative effect on rate depending on the direction. Currently with Sterling struggling and on a negative streak I do think there is more chance of the rate falling than going up.

If you do have a question with regards to my forecast or have a different question please get in touch. When you come to moving large sums of money a movement of a cent can often relate to a significant difference in your returns. Helping you formulate a strategy could make sure you’re in the best position to exchange currency when the market is in your favor, please contact me Ben Fletcher at brf@currencies.co.uk