Daily Archives: October 4, 2017

Further falls for the Australian dollar (Dayle Littlejohn)

Many economists globally are expecting the Australian dollar to come under further pressure for the rest of the year as the US begin to reverse the bad run seen over the last 6 months. It’s been widely publicized that the Federal Reserve are likely to raise interest rates in December. If this materializes the overpriced Australian dollar is likely to devalue as currency speculators move out of the risky commodity currency and into the safe haven US dollar for higher returns on their investments.

In regards to GBPAUD exchange rates the pound has been losing momentum against the Australian dollar over the last 5 trading days as yearly GDP numbers fell to 1.5% from 1.7%, mortgage approvals were down by 3,000, markit manufacturing fell from 56.9 to 55.9 and PMI construction fell from 51.1 to 48.1. However the Bank of England are suggesting an interest rate hike could occur as early as next month which could provide further opportunity for Austrian dollar buyers.

This evening Australia are set to release retail sales numbers, trade balance, including import and export numbers and RBA assistant Governor Debelle’s speech. For more information on how these data releases impacted the market feel free to drop me an email and I will respond tomorrow morning.

If you need to buy or sell Australian dollars and would like to save as much money as possible, feel free to email me with your requirements and I will respond with the process of using our company drl@currencies.co.uk. As a company we pride ourselves in the ability to get you a better exchange rate than your current currency provider or your bank. In addition we can outline your options and the potential future events, which will impact your exchange rate. This will help you to make informed and educated decisions.

 

 

Back to normal on GBPAUD exchanges!

After briefly rising above 1.70 on a strengthening pound and a weaker Aussie, GBPAUD is currently back into the 1.68’s. This is largely a revert to the more normal themes on the currency pair with sterling ebbing lower and the Aussie stronger. The pound is weaker because UK economic data has failed to live up to the high expectations, the Australian dollar stronger because the RBA (Reserve Bank of Australia) kept rates on hold and were not dovish in their commentary over when rates might rise in Australia.

I say back to normal because this is the more usual behaviour the pair has displayed and that has driven GBPAUD rates. We have said many times that for any clients buying Australian dollars with pounds will more than likely end up disappointed from holding on too long since the pound seems bound to remain on the weaker side.

Some investors had also been laying bets the RBA would raise interest rates next year, the removal of these expectations in commentary fro the RBA had seen the Aussie weaker helping with the moves over 1.70 recently. However despite the change in sentiment, the Australian dollar with a interest rate of 1.5% remains one of the most attractive currencies to hold from the perspective of how much yield or return it will give investors. This helps keep the Australian dollar strong and should serve as a reminder to any clients hoping GBPAUD would quickly go to 1.80 or higher in the coming weeks and months.

Global events also must be factored in here, the Australian dollar was weaker on concerns over North Korea too but these tensions have cooled. Expectations on when the US will raise interest rates also play a part and could see the Aussie weaker if the US raise interest rates in December although generally speaking the US has been disappointing investors with the pace of hikes and the US dollar is much softer.

Friday is the big day this week with US Non-Farm Payroll data which will have a bearing on the Aussie as investors switch positions around according to their views on the US and global economy.

If you have a transfer pending buying or selling Australian dollars why not get in touch and see if we can help? I am very confident I can give you some insight into the latest trends plus offer a rate which will save you money over other options. Any information is completely free of charge and at no obligation, you have nothing to lose from sending an email.

Thank you for reading and I look forward to hearing from you and assisting with any transfers.

Jonathan Watson

jmw@currencies.co.uk