Daily Archives: May 4, 2018

Is the Australian Dollar likely to improve against the Pound during May?

The Australian Dollar appears to have gone from strength to strength vs the Pound in the last two weeks after the UK has released a string of poor economic data.

Last week UK GDP data for the first quarter of 2018 came in much lower than expected with just 0.1% growth quarter on quarter which is the slowest level since 2012 and shows signs of a real slowdown in the UK.

Only a fortnight ago average earnings had outpaced inflation for the first time in a long time and this increased the chances that the Bank of England may be gearing up for an interest rate hike on 10th May.

However, since then the negative data in the UK means that a rate hike happening next week is now highly unlikely and this is why we have seen the Pound drop against a number of currencies including the Australian Dollar.

Indeed, this is the first time in a few weeks where GBPAUD exchange rates are now trading below 1.80 on the Interbank level.

On Tuesday there is a huge amount of data due out from China and as the Chinese are the largest trading partner with Australia any data announcement can have a big effect on Australian Dollar exchange rates. We see the release of Chinese Export & Import data as well as the Trade Balance figures so if the data is positive this could mean further gains for the Australian Dollar.

In the longer term I expect the Pound to make gains vs the Australian Dollar but in the short term I think the Pound will remain under pressure.

Therefore, if you’re in the process of buying Australian Dollars in the next few weeks it may be worth getting things organised soon.

If you have a currency requirement coming up and would like further information about what is happening or for a free quote then contact me directly and I look forward to hearing from you. Having worked for one of the UK’s leading currency brokers for 15 years I am confident of being able to offer you bank beating exchange rates.

Tom Holian teh@currencies.co.uk

 

 

AUD Forecast – RBA Predicts Australian Economic Growth to Accelerate Over the Coming Months (Matthew Vassallo)

Any clients with an upcoming AUD currency exchange to execute, would have been keeping a close eye on the latest Reserve Bank of Australia (RBA) monetary policy statement.

This was released and as expected, the central bank predicted economic growth to accelerate during 2018. They predicted Gross Domestic Product (GDP) figures to hit 3.25% by the end of this year, before peaking at 3.5% during 2019.

Despite this positive outlook they remained dovish regrading inflation levels, as they do not expect these to hit their target level until 2020. This is a key indicator that interest rates are likely to remain at the current record lows for the foreseeable future.

Despite no indication of a rate hike the AUD has performed well of late, particularly against Sterling.

GBP/AUD rates fell below 1.80 overnight and despite the Pound finding some support back above this threshold, the AUD is likely to hold its position as we head into the bank holiday weekend.

The AUD has gained over 5 cents in the past two weeks, which is equivalent to an additional £1,500 on 100,000 AUD/GBP currency exchange.

Investors will still be wary about any potential slowdown in the global markets having a negative impact on the Australian economy, which relies heavily on the export of its raw materials. Any major slowdown in this sector is likely to hit the AUD but for the time being it is the UK economy which is being viewed in a more negative light.

A poor run of economic data has dragged the Pound’s value down and given those clients with an AUD/GBP currency exchange to execute an opportunity, that seemed unlikely to occur only  a couple of weeks ago.

If you have an upcoming 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 winning 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.