Category Archives: AUD to GBP

Important events on the Australian dollar this week

The Australian dollar exchange rate has been volatile in the last few weeks owing to the uncertainty over the future direction we will see on a number of factors. These include the Trade Wars with China and also the outcome from the latest economic data in Australia. Investors are expecting us to see the Australian currency closely reacting to developments on these issues, the immediate outlook is not clear.

China’s economic performance is a key indicator of the Australian dollar as investors track its progress with a view to better understanding where events will turn next. One of the key factors in all of this will be the next steps that the Trade Wars take with investors feeling any negative news would see the Australian dollar weaker.

Overnight are two speeches by RBA, Reserve Bank of Australia, members which will carry some weight in the market. The actions and comments by the central bank are very important in providing some direction on which way the currency will perform in the week ahead. Most notably ahead is the speeches by Assistant Governor Bullock and also Debelle, either of which could prove most interesting for the Aussie.

Last week, there was some more positive Unemployment data released which will have had a more swaying impact on future economic policy from the RBA. Other news I would foresee as being instrumental in shaping the likelihood of market fluctuations will be the ECB interest rate decision. The European Central Bank will provide some insight into their own future monetary policy as well which will influence global risk sentiment.

In targeting a higher interest rate over the longer term, the Australian dollar exchange rate could lose value if investors look to try and shift towards the potentially higher yielding Euro.

If you have a currency transfer involving the Australian dollar and wish to learn of some of the latest market news, please do not hesitate to contact me Jonathan Watson directly.

Jonathan Watson

jmw@currencies.co.uk

AUD Forecast – What are the Factors Driving GBP/AUD Exchange Rates? (Matthew Vassallo)

GBP/AUD rates have dipped slightly during Thursday’s trading, with the AUD continuing to find support around the current levels.

The pair fell to a low of 1.8338, having been trading above 1.84 at its high over night.

The Pound has failed to make any sustained inroads against the AUD since the weekend, after premature talk of a Brexit agreement caused a sharp sell-off of GBP positions on Sunday.

This put the Pound on the back foot when trading lines opened on Monday. It has been a tough week for Sterling, which has seen its value decrease by around three cents, or the equivalent of 3000 AUD on 100k GBP/AUD currency exchange.

I anticipate that the AUD will now find plenty of support again around 1.85, when it seemed as though the Pound was set for a run on 1.90 last week, when a Brexit deal looked imminent.

This is another prime example of how the markets may price in an expected political outcome, only to see the currency in questions value diminish when the expected result does now come to fruition.

Looking at the driving factors behind GBP/AUD and any updates or breakthrough in Brexit talks, will no doubt boost investor confidence and the Pound is likely to benefit as a result. Similarly any talk of a no-deal outcome again and it will likely have the opposite e effect.

Looking at the Australian economy and current slowdown in global trade is certainly having a negative impact. This, along with the current trade war between the US & China is causing investors to shy away from riskier currencies such as the AUD. We generally see commodity-based currencies such as the AUD lose value during times of global economic uncertainty.

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.

 

Weaker AUD beneficial for the Australian economy, where next?

The recent RBA, Reserve Bank of Australia Minutes showed us that the RBA view the recent weaker Australian dollar as good news for the economy in helping to support growth. Australia’s economy is heavily reliant on the sale of its raw materials globally, including to China, its major trading partner. The expectation here is that the RBA will not be in any rush to raise interest rates, they view the weaker currency as ‘good news’.

The big news for this week on the Australian dollar is Unemployment data released in the early hours of tomorrow, at 12.30 GMT. The figures are predicted to show the Unemployment rate holding steady but a lower participation rate and possibly a lower employment rate. This could see the Australian dollar weaker as it underscores the recent direction and sentiment that has weakened the currency.

This could mean the Australian dollar continues to drift lower and remain weak, particularly owing to other factors including the likelihood of Trade War issues continuing to weigh on China, its largest trading partners. Markets are concerned that the Chinese economy is struggling as a result of the trade disputes with the US and Donald Trump, this has seen some economic indicators in China reach concerning levels.

China is struggling with a slowing rate of growth and concerns over home sales, rising Inflation and also falling car sales. Other examples of anxiety include the amount of debt taken on by Chinese authorities in their pursuit of infrastructure to build their economy. All of this is painting a slightly worrying picture for the Chinese economy as the trade wars are likely to get worse and this will all put pressure on the Aussie dollar too.

If you have a transfer involving the Australian dollar into any other currency and wish for some expert insight into the trends and themes to move the market, why not get in touch with us. We are a firm of specialist FX brokers with many year’s experience in managing large volume international payments.

Thank you for reading and we hope to hear from you soon.

Jonathan Watson

jmw@currencies.co.uk

GBP/AUD hits lowest level in 10-days as Brexit issues weigh on the Pound

The Pound to Aussie Dollar exchange rate has fallen to its lowest levels of the past 10-days. This has happened after GBP/AUD hit an annual high of just over 1.87 last week, which was also the highest level since the major drop in June of 2016 when the Brexit vote outcome was announced.

Sterling had hit such high levels against AUD as hopes of a Brexit deal being agreed shortly were high. These hopes are now fading and GBP exchange rates have softened across the board of major currency pairs as it now look likely that UK and EU negotiators will not be able to agree on the terms of the Brexit deal by the EU’s deadline.

Later this week there will be an EU Summit in Brussels and the main focus is expected to be the Brexit. UK Prime Minister, Theresa May will give a speech to the EU leaders regarding her plans and the progress made so far. There will also be meeting behind closed door’s that she isn’t invited to, and depending on the outcome of the recent negotiations and the EU Summit this week I think there could be movement for the GBP to AUD rate.

The Aussie Dollar hasn’t lost a dramatic amount of value against the Pound as markets will still be holding out for a Brexit deal by November, but seeing GBP/AUD drop over the past few trading days is worth considering for those of our clients planning on making a transfer.

From the Australian side there will be Employment data out of Thursday at 1.30am UK time. If you wish to be updated in the event of a major market movement do feel free to register your interest.

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.

 

What can we expect next for the Australian dollar?

The expectation is the for the Australian dollar to continue to face headwinds as the market tries to assess its attractiveness over the longer term. With Australia struggling whilst some other assets become more attractive, the pressure is on for the antipodean currency. Having lost value in recent weeks as market expectations deteriorate, what can we expect in the short term?

To answer some of the questions over the Australian dollar’s recent performance look no further than the United States. A key factor in this has been two fold from the US with raising interest rates and the Trade Wars both weighing on the performance of the Aussie dollar.

In raising interest rates to 2.25%, the US dollar is now a much more attractive currency to be holding from an investors point of view, versus the 1.5% on offer from Australia. With regard to the future prospects in this department, it appears likely that the US will be continuing to raise interest rates. This will only increase the trend we have seen of late and continue the pressure on the Australian currency.

On the subject of Trade Wars, these do not appear to be diminishing and therefore the Australian dollar should remain under pressure as these potentially intensify or remain in place. Expectations for the Australian dollar will continue to focus on its attractiveness to hold but with these issues continuing and wider concerns in the global economy about just what lies ahead, the Aussie might find more troubled waters ahead.

Next week is Unemployment data which will be a big driver on the exchange rate and could see a shift. There is a focus on Australian interest rates too and we could easily see this data impacting future decisions. Whilst no hikes are likely down under anytime soon, this is a more short term factor to move rates.

Thank you for reading this post and I would be delighted to speak to you if you have a currency transaction to make in the coming weeks. Please contact me Jonathan Watson on jmw@currencies.co.uk to learn more.

GBP AUD Breaks 2 Year High (James Lovick)

The pound has made good gains against the Australian dollar this with rates for the GBP AUD pair back over 1.85. Rates for GBP AUD have now broken above a two year high creating a good opportunity for those looking to buy Australian dollars. The pound is receiving some mixed signals on Brexit although the general consensus is that a deal is within sight.

The EU are expected to offer the UK a proposal which should allow for much of the Chequers proposal being championed by Prime Minister Theresa May. It has been reported that something around 30-40% of her proposals will be granted in a deal but the stumbling block of the Irish border appears to remain. A new stumbling block has appeared in the form of the political declaration that will be made with the withdrawal agreement. Theresa May is asking for a precise agreement on frictionless trade, something the EU is reluctant to agree to. Expect considerable market volatility and opportunity as new developments unfold over Brexit.

The Australian dollar has had some of its confidence dented this week as events in China give cause for concern for global growth. The Peoples Bank of China has intervened to try and stimulate growth in China by lowering finance costs which should encourage growth. The markets are taking this as a sign that China is noticeably concerned about the prospect of a slowdown in China which is seeing funds move out of the Australian dollar. There has been a clear flight to safety away from emerging markets back to the safety of the dollar which could see further falls in the Australian dollar if the trend continues.

For more information on Australian dollar exchange rates and for assistance in timing your exchange at the best exchange rates then please feel free to contact me James at jll@currencies.co.uk

Price changes for GBP/AUD likely to be driven by the Pound over the next 24-hours

Those of our clients and regular readers following the Pound to Australian Dollar exchange rate should pay close attention to UK politics today, as I believe the next spike in the GBP/AUD’s value is likely to be driven by UK politics.

Yesterday all eyes were on Boris Johnson’s speech at the Conservative Party Conference, and he didn’t disappoint as he gave another harsh critique of the ‘Chequers plan’ devised by the current UK Prime Minister, Theresa May. Today there could be movement for Sterling exchange rates against all major currency pairs as it’s the final day of the Conservative Party Conference, and Theresa May is scheduled to speak with Brexit being the main focus.

Yesterday Boris Johnson was supportive of May’s leadership but he once again urged her to move away from the Chequers plan she has devised and suggested that she focuses more on a Canadian style deal. I expect her to be questioned on his comments and the markets to follow her responses closely. With Brexit now just around the corner and expectations of a deal being in place by November, I expect to see Brexit headlines dominate financial media and for it to be the main driver of the Pound to Aussie Dollar exchange rate.

On the Australian side we’ve seen the currency soften over the past year, mostly owing to Aussie Dollar weakness. The greater the gap between US and Australian exchange rates the more likely this trend will continue, so those following the strength of the Aussie Dollar should also pay attention to US monetary policy and this is something we can help our readers with should they wish.

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.

RBA interest rate decision key for AUD movements this week

Tomorrow we have the release of the RBA (Reserve Bank of Australia) interest rate decision and possibly more importantly the RBA rate statement.

There are no expectations of any interest rate changes this time around but what will be key is the tone of the RBA in their monetary policy statement. The Australian economy has shown small signs of growth and with that we would expect a slightly more positive tone from the RBA, but I would personally be surprised to see a nod towards any imminent change to interest rates as there is still an issue with rising house prices and high household debt. Not to mention the on-going trade wars between China and the U.S that have been regularly covered on this site.

Interest rates can be key to the value of a currency and even the mere speculation of a rate hike can lead to that currency gaining strength, so should the RBA suggest that a hike is getting closer then you could expect to see the Australian Dollar gain a little value in Tuesday’s trading.

The rate decision dominates market news out for Australia this week but there are a number of other releases around the globe that may still impact Australian Dollar exchange rates. For those tracking GBP/AUD we currently have the Conservative party conference on until Wednesday in the U.K along with Brexit which could throw up anything at any time. Anyone following EUR/AUD will be keeping a keen eye on the Italian debt and budget issues that are creeping into the media and for those with an interest is USD/AUD the Non -farm payroll data due out in the states at the end of the trading week on Friday will be one to watch.

Non-Farm payroll data measures the number of people in Non-agricultural employment in the states and can have an impact on all major currencies as it will effect global attitude to risk.

If you have a pending Australian Dollar exchange to make and you would like assistance with it, both in terms of getting the most for your money and moving it over securely then feel free to contact me (Daniel Wright) directly. You can email me on djw@currencies.co.uk and I will be more than happy to get in touch.

GBP AUD ahead of Conservative Party Conference (James Lovick)

The Australian dollar has come under a degree of pressure of late as trade war concerns continue to weigh heavy on the Aussie. The cooling property market down under with considerable falls seen in both Sydney and Melbourne are also attracting concerns from the Reserve Bank of Australia. While the markets are not expecting a property market crash bearing in mind the falls in house prices appear to be coming from two cities, the central bank will nonetheless be in no hurry to raise interest rates which could potentially slow growth.

Rates for GBP AUD are currently sitting at 1.8140 and the two biggest drivers for the pair will be Brexit and the ongoing US trade war with China. The Australian dollar is negatively impacted by the global uncertainty for a slowdown in global growth especially considering that China is such a major export market for Australia.

UK Prime Minister Theresa May was in New York yesterday speaking on Brexit as she tried to reassure business that a deal between Britain and the EU will be reached.

UK Gross Domestic Product figures are released tomorrow morning although the central focus in my opinion will be on the Conservative party conference this weekend. With so much to negotiate in these Brexit negotiations and the difficult task that Theresa May has in finding a deal that will work for the EU but also one that she can get through in parliament then there is considerable risk for the pound over these next two months.

An agreement is expected to be found although any clues as to whether the Chequers deal will fly or if another Canada type trade agreement takes preference will inevitably have a direct impact on the price of sterling exchange rates. With splits in the cabinet over a softer or harder Brexit then this conference in my opinion could give new direction for the price of sterling.

For assistance in transferring Australian dollars at the best exchange rates then please contact me James at jll@currencies.co.uk

Will GBPAUD remain above 1.80?

For clients buying Australian dollars with pounds, over the last couple of weeks opportunities have presented themselves. Arguably this is because the Australian PM was ousted and trade wars between China and the US is putting pressure on the commodity currencies.

However short term, Australian dollar buyers could be running out of time. After this weekend the Conservative Conference will start and we should find out the more about the Conservative party’s stance in regards to Brexit.

UK Prime Minister Theresa May has reinforced in recent weeks that her Chequers plan is the only option. However MPs such as Boris Johnson have called for the Prime Minister to forget her chequers plan and to adopt a similar approach to the Canadian free trade agreement.

Personally I expect the PM to come under further pressure and there will be further commentary in regards to a vote of no confidence. If this materialises and therefore there is any chance of a general election GPBAUD could be back trading in the 1.60s before long.

Any other news Governor of the Bank of England Mark Carney is set to deliver a speech in Salzburg tomorrow. Interest rates are set to remain on hold for the time being and I expect him to be cautious knowing that the conservative conference is fast approaching. It was only last week he stated 35% of the housing market could be wiped if there is a no deal, therefore this could be another sterling negative release.

If you are buying or selling Australian dollars in the future, I would strongly recommend getting in contact to discuss your requirements. 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 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.