Daily Archives: October 18, 2017

Will GBPAUD break through 1.70?

Economists are split at present in regards to the future of GBPAUD exchange rates, and after reading the last few articles on this website, it seems that traders on the trading floor are also split and it’s no surprise when the UK’s Brexit negotiations continues to spring surprises.

Head EU negotiator Michel Barnier has announced that Brexit negotiations had hit deadlock however that same day reports were suggesting that EU officials would meet to discuss what a potential trade deal would like if the UK and EU come to an agreement about EU citizens rights and the divorce settlement bill.

With UK inflation breaking through 3%, the market is pricing in an interest rate hike which could push GBPAUD through the 1.70 barrier. However Governor of the Bank of England Mark Carney’s comments yesterday do not fill me with much confidence. He was asked if the Bank of England plan to change monetary policy and would not give a straight answer. Nevertheless in the next 2 weeks I believe the pound will strengthen enough in anticipation providing Australian dollar buyers with a window of opportunity to buy Australian dollars above 1.70.

Longer term its important to understand that predicting the Brexit negotiations outcome is impossible. Positive news will strengthen the pound negative will do the opposite. I am optimistic that deal will be struck eventually however other traders on the floor are not. If you are purchasing pounds with Australian dollars or vice versa I would recommend getting in touch and I will keep you up to date with regular information until you are ready to convert drl@currencies.co.uk.

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.

 

GBPAUD struggles to maintain recent form

The GBPAUD exchange rate has slipped lower from the highs of 1.69 and 1.70 fairly recently as investor concerns over the outlook for the UK to raise interest rates increase. Yesterday was the latest Inflation data for the UK and today is Unemployment data where we will get the latest news on Wage Inflation. A big driver on GBPAUD rates this week is how the market reacts to the prospect of the UK raising interest rates which now looks less likely.

Overall the Australian dollar has been stronger against sterling after investors retain an interest in the higher yielding Australian dollar which represents a very good opportunity to earn a higher yield on their investments. The big news on the Australian dollar will be the Unemployment data which is released tomorrow evening and could see the Aussie even stronger against the pound.

If you have a transfer buying or selling the Australian dollar then making some plans in advance is key to understanding the current trends and themes in the market. With there being a high chance the pound will lose further value GBPAUD rates could be well worth considering if you have to buy Australian dollars with pounds.

We are currently at some of the better rates of this year, the worst deals were in the 1.50’s so with 1.70 only a couple of cents away and the forecast in my opinion pointing downwards say to the mid or lower 1.60’s, I think if you are buying Australian dollars moving sooner would be the best course of action.

For AUD sellers buying pounds the market remains very favourable so if you have a transfer to consider buying or selling please don’t hesitate to get in touch and discuss further the market and how we can help you. Please email jmw@currencies.co.uk for further information.