Monthly Archives: April 2019

Austrlian dollar forecast: Is the Austrlian dollar set to lose further value?

Last week yearly Australian inflation fell to 1.3%, when many market forecasters were predicting 1.8%. Lower global oil prices at the back end of 2018 is being labelled as the main contributor. Now that inflation has fallen, bookmakers are predicting that there is a 50% chance that the Reserve Bank of Australia will now cut interest rates next week. Last time yearly inflation dropped this low was in 2016 and former Governor Glenn Stevens cut interest rates. The question is, will Philip Lowe follow suit?

Over the years, when a central bank cuts interest rates we tend to see the currency devalue. Furthermore this can actually happen before the event as speculators begin to second guess the decision. For clients that are selling Australian dollars to buy a foreign currency short term, there is a strong argument to buy your currency sooner rather than later.

Australian dollar to sterling predictions

Even though the Australian dollar could face pressure in the upcoming weeks due to monetary policy decisions, sterling has problems of it’s own. The pound has lost momentum over the last 4 weeks once Theresa May accepted a 6 month extension to the Brexit process. At present the PM and the leader of the opposition continue to negotiate in London and the customs union debate is at the centre of the negotiations. Labour leaders Jeremy Corbyn wants to remain part of a customs union, where as for Theresa May this a red line she is not prepared to back down on.

Personally I believe the PM is running out of time. If she doesn’t want to take part in European elections a decision will have to be made very soon. Therefore I expect her to announce that the negotiations have failed and therefore are over and consequently will give MPs another vote in the commons to try and reach a majority. All in all, it doesn’t look good news for clients holding onto sterling.

If you are buying or selling Australian dollars in the future, I would strongly recommend getting in contact to discuss your situation. The company I work offers a proactive service to offering economic information whilst having the ability to offer award winning exchange rates. Feel free to email me with the currency pair you are converting, your requirements along with the timescales you are working to and I will respond with my forecast and the process of using our company drl@currencies.co.uk.

 

 

Pound to Australian Dollar Forecast and the impact of low inflation and the election

The Pound has had a relatively strong week against the Australian Dollar after we saw inflation figures in Australia drop compared to the expectation.

Figures were predicted to come out at 1.8% but they fell to 1.5% and this is likely to add further pressure to the Reserve Bank of Australia to consider cutting interest rates sooner than they may have previously considered.

The RBA are under pressure to look at cutting interest rates in an attempt to help the ailing property market as well as trying to control falling inflation so this week’s data is likely to bring an interest rate cut forward and this could happen as early as 7th May when the RBA holds its next monetary policy meeting.

The general expectation for interest rates in Australia is for two cuts this year bringing interest rates to their lowest level on record at just 1%.

However, as Australia goes to the polls next month to vote in the next election on 18th May the RBA may just hold fire from changing monetary policy as to change things now could cause a lot of volatility for the markets if the central bank intervenes too soon.

Current Prime Minister Scott Morrison has tried to defend his economic record during his tenure but with GDP figures slowing down during the last year he is facing questions as to how he can turn the economy round under his stewardship.

As we move into next week the key data release of the week could be Thursday’s Chinese Manufacturing PMI data. As China is such a huge trading partner with Australia this can often have a large bearing on the value of GBPAUD exchange rates so make sure you’re well prepared for what could be a busy end to the week.

I have worked for one of the UK’s leading currency brokers since 2003 and I’m confident not only of being able to save you money when exchanging Australian Dollars but also to provide you with further information as to how the market is moving.

For a free quote then contact me directly and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

Aussie Dollar weakens as rate cuts look likely, how could this impact the Aussie Dollar?

The Australian dollar has had a bad week after hitting the lowest levels of the month against the Pound, and also the lowest levels in 2-months against the US Dollar.

Those of our readers planning on making Pound to Australian Dollar exchanges should be aware that the current levels are within 4-cents from the annual highs, which are also the highest levels seen since June of 2016 making this years annual high the highest levels seen in 34 months.

We’ve witnessed a sell-off in the AUD’s value this week after some disappointing inflation data was released on Wednesday, demonstrating that inflation levels down under are running at a 16 year low. Many economists now believe that there will be at least one interest rate cut this year and that there will be one in June in order to try and stem the weak inflation levels. Up until this point the Reserve Bank of Australia has been loath to hike rates so as to not impact the already overheating property market, especially on the East coast but this week’s data may have been the nail in the coffin.

Moving forward I’m expecting to see AUD continue to soften proving cuts take place, as should they occur the base rate of interest will be at another record low.

If you are planning to make a currency exchange involving the Pound and another foreign currency, it’s well worth your time getting in contact with me on jxw@currencies.co.uk in order to ensure you make a well informed decision on when to make that particular transfer, as well as benefiting from highly competitive exchange rates from one of the UK’s leading foreign currency brokerages. Just provide me with a basic outline of your currency requirement and I will be back in touch with you as soon as possible.

Pound to Australian dollar predictions: Will the pound continue to rise against the Australian dollar?

Over the last 4 weeks there have been opportunities for clients selling pounds to buy Australian dollars and vice versa. A month ago GBPAUD mid market exchange rates were trading close to 1.87. Following the UKs decision to extend Article50 by 6 months the pound lost momentum and dropped to 1.81 just over 10 days ago. However the pound has fought back with mid market rates now at a 10 day high of 1.84 due to the economic data released in Australia.

Quarterly inflation numbers for Australia released in the early hours of Tuesday morning dropped to 0% which is a major concern. Off the back of the news ANZ and TD securities which are well respected in their fields have both predicted that an interest rate cut of 25 basis points is on the horizon. Past history tells us when a central bank cuts interest rates the currency in question tends to be sold, meaning it becomes less valuable, hence the reason why pound to Australian rates have risen.

Looking further ahead, UK Prime Minister Theresa May is going to continue the negotiations with the leader of the opposition Jeremy Corbyn. The Prime Minister is hoping to thrash out a deal early next month in a bid to avoid European Elections. The reality is the PM is not prepared to remain in a customs union therefore its difficult to see how they will find a solution. Therefore I expect the UK will take part, which will cause more uncertainty for the PMs future and consequently the ongoing Brexit saga.

However short term the pound could actually make gains against the Australian dollar due to the problems down under. Next week Australia release their latest building permits and home sales numbers. If they fail to impress then the chances of an interest rate cut by the Reserve Bank of Australia  will increase which could put major pressure on the Australian dollar.

If you are looking to buy or sell Australian dollars in the upcoming months, I recommend that you get in touch. The currency company I work for offers fantastic rates whilst providing regular market information. My direct email address is drl@currencies.co.uk. Feel free to email with a detailed description of your requirements and I will respond with your options and the process. If you are using a currency provider at present feel free to drop me an email for a quote.

Pound vs Australian Dollar Forecast and the impact of inflation and an election

The Australian Dollar has been performing a little better as of late vs the Pound however things could be different over the next few days when Australia releases its latest inflation data.

Expectations are for a fall from 1.8% to 1.5% and if this happens I think we could see some Australian Dollar weakness ahead.

The reason is that if inflation falls this could put pressure on the Reserve Bank of Australia to consider cutting interest rates in the near future.

The Australian economy has been under pressure during the last few months for a number of reasons with one big factor that of the housing market.

Property prices across the country have fallen and a central bank will often look at cutting interest rates in order to give the sector a boost.

The impact of an interest rate cut usually results in weakness for the currency involved and that is why I think the Pound could increase on Wednesday when the RBA announces the latest inflation data.

However, although I think the Australian Dollar could weaken I do think that the RBA will keep rates the same over the next few weeks as we are just over a month away from the next elections in Australia and a central bank will often keep monetary policy the same as changing it can result in a lot of uncertainty for markets especially when an election takes place.

The Labour party down under is gaining more votes and this is not popular for big business as the result would likely to be increased taxation and this could be another reason why the Australian Dollar could suffer if the party wins next month.

If you would like to save money on exchange rates when buying or selling Australian Dollars and would like a free quote then contact me directly and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

Australian inflation to drive Australian dollar exchange rates

In the early hours of this morning the latest unemployment rates were released for Australia. As expected unemployment rose by 0.1% to 5% however the market reaction has been limited as this was to be expected. Next week Australia will release their latest inflation numbers and these should be watched closely. Yearly inflation is set to fall to 1.5% from 1.8% and monthly inflation is set to fall 0.2% from last months 0.5%. If the numbers are released as expected this is going to put severe pressure on the Reserve Bank of Australia to rethink their monetary policy. As house prices are continue to fall and the market is stagnant, I expect a cut interest rates would be on the horizon and in turn this would devalue the Australian dollar.

In recent weeks the Australian dollar has been making gains against the pound. GBPAUD rates have dropped 5 1/2 cents making a AU$400,000 purchase  £6,700 more expensive. The pound has come under scrutiny due to the ongoing Brexit negotiation. The 6 month extension has put further pressure on businesses due to the uncertainty.  The negotiations will continue in the upcoming weeks however I don’t expect Theresa May and Jeremy Corbyn to find common ground. Therefore I am expecting the pound to continue to decline and be trading in the 1.70s sooner rather than later.

If you are trading GBPAUD this week, month or year I would recommend emailing me with the reason for the transfer (company goods, property purchase) and your timescales and I will response with the options available to you drl@currencies.co.uk. Alternatively if you would like to discuss your requirements over the phone call 01494-787478 and ask to be put through to Dayle Littlejohn.

** If you are already using a brokerage, I would strongly recommend you compare rates as I am confident I will be able to offer you additional savings with your transfer. All you need to do is email me with the exact figures and I will reply with our live price. This will take you a few minutes and in the past I have saved

Pound to Australian Dollar Forecast – Brexit Limbo does not bode well for the Pound

UK & Brussels at Impasse

Although investor concerns may have been eased following the Brexit extension the Pound still remains fragile and I would be surprised to see any significant gains against the Australian Dollar until we have firm news on Brexit. It seems as though the UK and Brussels are at a complete impasse, Theresa May has put several different alternatives to her deal to the House of Commons all of which have failed to gain a majority and Brussels have stone walled the UK stating it is the current deal or nothing.

European Council President, Donald Tusk sent out a warning to his “British friends” saying “please do not waste this time .” It seems as though another extension will be unlikely.

Brexit remains in Limbo and I would not be surprised to see us in a similar situation come October.

The Australian Dollar has its own problems however, Housing prices remain inflated in high wage growth areas such as Melbourne and Sydney. It mean Australians are being forced to spend their hard earned money on necessities rather than luxury goods and services.

Australia  has a heavy reliance on China purchasing its goods. The US/China trade war is causing a slowdown in Chinese growth which is having a knock on effect to the Australian economy and in turn the Australian Dollar. Iron ore is Australia’s primary export and fluctuations in its price can cause a change in Australian Dollar value, it is worth keeping an eye on if you have a trade involving the Aussie.

Recent news coming from US/China trade talks suggest an end could be in sight. US Treasury Secretary , Steven Mnuchin has stated we could see a conclusion to the trade war in under a month. If this is the case we could see substantial gains for the Aussie.

There are still however key points of contention. The US would like to keep existing tariffs in place in order to keep pressure on China , while Beijing would like them stopped immediately.

If you have a currency requirement I will be happy to assist. If you let me know the details of your trade I will endeavor to produce a free trading strategy. During a period of such uncertainty it is important to be in touch with an experienced broker if you wish to maximize your return. We have tools at our disposal to make sure you do not miss out if there is a spike in your favour.
If you already have a currency provider in place. Drop me an email with what you are being offered and I am very confident I will be able to demonstrate a significant saving. It will only take you two minutes and I am sure it will be worth your while. You can trade in safety knowing you are with a Foreign Currency Direct PLC, a firm trading for over 18yrs and FCA registered.
If you would like my help feel free to email me at dcj@currencies.co.uk.

Pound against the Australian Dollar falls as RBA may not cut interest rates

The Australian Dollar has seen some signs of strength recently as it appears as though the Reserve Bank of Australia may not be looking at cutting interest rates as soon as previously expected.

The Trade Wars between the US and China also appear to be getting closer to a resolution and as China is Australia’s largest trading partner this has helped the value of the Australian Dollar.

Australian is also a huge producer of Iron Ore and its main export market is China. Australia has approximately 65% of the global market and any price change in the value of the commodity will often affect the value of the Australian Dollar.

Chinese demand has started to increase for the commodity and rumours are increasing that many Iron ore mines in Brazil are due to be closing. This means that global supply will reduce which will in theory increase demand for Australian iron ore.

However, although the news is good concerning the news above, the risk going forward is that of the Australian election which is due to take place in just over a month’s time.

Labour are doing well in the polls so a change in leadership could see the Australian Dollar come under pressure once again so make sure you keep a close eye out on the election campaign as this is likely to have a big impact on the Pound against the Australian Dollar.

Meanwhile, the ongoing uncertainty caused by Brexit has caused the Pound to weaken marginally against a number of different currencies which is good news for anyone looking to buy Pounds at the moment as GBPAUD exchange rates are at the lowest rate in two months.

If you have a currency transfer to make and would like to save money on exchange rates then contact me directly for a free quote and I look forward to hearing from you. Having worked in the currency industry since 2003 for one of the UK’s leading currency brokers  I’m confident that I can save you money compared to using your bank for the transfer of Australian Dollars.

Tom Holian teh@currencies.co.uk

 

 

The impact of the Australian election next month on the Pound against the Australian Dollar

We are now just 5 weeks away from when the Australian federal election is due to take place on Saturday 18th May.

Generally speaking an election will often result in weakness for the currency involved as not only is the result uncertain but how will business be impacted causes uncertainty for investment in to the country during that period.

All of the 131 seats available in the House of Representatives are up for re-election as well as a total of 40 out of the 76 seats in the Senate.

At the moment current Prime Minister Scott Morrison is aiming to win another three year term but the opposition Labor party are looking to mount a challenge having been out of power for six years.

According to a number of polls recently the Prime Minister is potentially going to lose against the Labor party as they have pledged to reduce pollution levels by as much as almost half by 2030 compared to that in 2005.

The economy down under is also experiencing a slow down and with Morrison the seventh Prime Minister in the last ten years it appears as though Australians want to see a more stable government so we could be seeing a change coming in the next few weeks.

As we move closer to the election I think we could see the Pound making some improvements against the Australian Dollar so if you’re considering making a transfer to Australia it will be worth paying close attention to what happens during the election campaign during the next few weeks.

I have worked for one of the UK’s leading currency brokers since 2003 and I’m confident that I’m able to offer you bank beating exchange rates as well as providing a more detailed insight as to what is happening on the currency markets to help you make a more informed decision.

If you have a currency transfer to make and would like to save money on exchange rates compared to using your own bank then contact me directly and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

 

Pound to Australian Dollar Forecast – Daniel Johnson

GBP/AUD – Brexit continues to dictate GBP/AUD and at present the situation remains in Limbo. Theresa May has now failed on three separate occasions with her deal and at present the default action if a deal is not reached by 12th April is the UK will leave the EU with no deal. Both sides are desperate to avoid this situation and it looks as though the outcome will be an extension.

How long the extension will be and with what stipulations is what is being hastily negotiated. May favours a short extension whereas Brussels would like a flexible year extension in place.

I believe an extension is already factored into current GBP/AUD levels as the market moves on rumour as well as fact. I would expect Sterling to gain value if an extension is confirmed as investor concerns are eased. Do not expect any great shakes however.

GBP/AUD has remained above the key resistance point of 1.80 despite the lack of progress in Brexit talks, I think this can be mainly attributed to the probability of a no deal remaining low with the vast majority of the House of Commons set against allowing a no deal scenario to occur.

I think Sterling will however remain fragile until we have firm news on Brexit, which now could be some way off. The Australian Dollar has it’s own concerns however. Housing prices in high wage growth areas continue to inflate and Australians are being forced to spend their money on necessities rather than luxury goods and services which is hurting the economy. The ongoing trade war between the US and China is also a key concern. Australia has a heavy reliance on China purchasing it’s exports, particularly iron ore. In fact iron ore value has been known to cause sways in the value of the Aussie.  The trade war is influencing Chinese growth which in turn has an impact on the Australian economy and the Australian Dollar.

Investors are choosing to shy away from riskier commodity based currencies in favour of what is considered to be safe haven currencies such as the Swiss Franc or the US Dollar.

I think if it were not for Brexit we could be seeing gains for Sterling against the Aussie, but at present you really need someone with an eye on the markets for you if you wish to take advantage of any spikes on the market, which recently have only been small windows of opportunity.

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker when the market is currently so hard to predict. If you let me know the details of your trade I will endeavour to produce a free trading strategy to suit your individual needs. Have faith knowing you will be dealing with a brokerage in business for over 18yrs, Foreign Currency Direct Plc. We are a no risk entity as we do not speculate on the market and we are registered with the FCA. If you have a currency provider take a minute to send over the rates they offer and I am confident I can demonstrate a significant saving. I can be contacted at dcj@currencies.co.uk .