Category Archives: Australian Dollar Weakness

Will the Australian dollar rise or fall against the pound?

The pound to Australian dollar exchange rates has improved lately as the pound finds some better form and the Australian softens every so slightly. In the most recent communications from the RBA (Reserve Bank of Australia), we learned that the RBA are concerned over rising house prices. We also learned that the RBA view the currency as too strong and whilst only a few weeks ago the view was that the RBA might raise interest rates later this year, for now, the direction appears to me to be fairly neutral. If you are making a GBPAUD exchange in the coming weeks I believe a big factor will be the Article 50 direction for sterling. With plenty of volatility expected nothing should be too readily assumed!

GBPAUD hit 1.59 last week as the lack of interest rate hikes in the United States presented a weaker US dollar. As the US dollar was sold off it benefitted the Australian currency as the Aussie is used by investors to benefit from its higher interest rates. By ‘parking’ funds in Australian dollars, investors have a higher rate of interest and therefore earn more on their money. Such trends help the Australian to strengthen and this partly explains some of the overall strength of the Australian dollar against the pound.

I would expect GBPAUD rates could move as much as 11 cents between the high and the low as markets digest the release of Article 50. I forecast rates between 1.56 and 1.67 depending on how the market receives the news. Because this has never happened before the scope and potential for swings are high.

If you have a transfer involving buying or selling Australian dollars then making some plans in advance is vital. If you would like some assistance with the timing and planning of any transfers you may contact me directly on jmw@currencies.co.uk. I have worked for almost ten years assisting clients buying and selling Australian dollars for pounds and am positive I can offer some useful assistance with a really good exchange rate (above other companies) and some useful information to make an informed decision on when to buy your currency.

GBP AUD Making Gains Before Article 50 is Invoked Next Week (James Lovick)

The Australian dollar has seen a wobble this week after concerns over the strong housing market have materialised. The minutes from the Reserve Bank of Australia’s last meeting gave warning to risks associated with the housing market.

It is often the case that the construction sector and housing markets are normally the first to suddenly fall in uncertain times and at the start of a recession for example so the central bank is simply picking up on the risks associated with this. It is a small concern considering the Australian economy has continued to perform well without a recession for the last 25 plus years but it still had the effect of weakening the dollar.

Meanwhile for GBP AUD it will be an eventful couple of weeks with the announcement that Article 50 to be formally invoked on Wednesday 29th March. This has the potential to create considerable market volatility and I am of the opinion that the pound may see some positive market movement at that time or even a day or so after. Those clients looking to buy Australian dollars may be presented with a short term window of opportunity.

Those clients with pressing requirements would be wise to set things up in place ready if there is substantial volatility.

As I have stated before, no country has ever left the European Union before so the decision really does have the power to create major volatility. There are no guarantees as to what exactly may happen but I feel it is fair to say that the pound will remain under pressure for some time yet as the Brexit negotiations between Britain and the EU will take a minimum of two years to be completed which leaves a very long period of uncertainty to come.

The Scottish second independence has been postponed after tragic the waste of life from the terror attack at Westminster Palace which happened yesterday. Whilst the Scottish Parliament are expected to vote in favour of a second referendum it will be the tone from Nicola Sturgeon after the vote which could play on sterling exchange rates.

If you would like further information on Australian dollar exchange rates or any of the major currencies and to discuss how we can assist then please feel free to contact me on 0044 1494 787 478 and ask one of the team for James. Alternatively, I can be emailed directly on jll@currencies.co.uk

Will the Pound fall when the Brexit begins next Wednesday? (Joseph Wright)

The Pound’s value was relatively unchanged in the wake of the UK government announcing the date for the start of the Brexit.

Towards the end of last week it emerged that the 29th of March will be the day Brexit is officially triggered, as UK Prime Minister Theresa May will invoke Article 50 in what Brexit secretary, David Davis has called ‘the most important negotiation for this country in a generation’.

I think the reason the Pounds value remained mostly unchanged is because the financial markets were expecting the announcement, after May made us aware of the governments plans and timescales towards the end of last year.

Personally, I think the Brexit is mostly priced into the Pounds value and I’m actually quite optimistic regarding the Pounds value moving forward. I think the major drops in the wake of the vote have seen the Pound consolidate at its new levels and it appears to see support at the 1.60 level against the Aussie Dollar.

The rising inflation in the UK is also likely to result in an interest rate hike which would likely boost the Pounds value, and there are concerns in Australia that the housing market is overheating, particularly in cities such as Melbourne and Sydney which could impact AUD’s value.

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.

GBP/AUD exchange rate hovering at pivotal point of 1.60 – Where will rates head next? (Daniel Wright)

GBP/AUD exchange rates have been loitering around the 1.60 mark for a number of days now and it appears that neither currency has the power to push through the current levels of resistance and make a break either way.

With Brexit and the triggering of article 50 clearly hanging over the head of the Pound the Australian Dollar has been on a very good run of form, seeing a huge boost last Wednesday when the Federal Reserve over in the U.S hiked interest rates but only gave the nod to a further two interest rate hikes this year as opposed to the expectation of seeing a further three.

Interest rate hikes in the U.S are generally seen as negative for the Australian Dollar as it makes the USD more attractive to investors. With the Australian Dollar and U.S Dollar a well known pairing that is used in carry trading, should either have news that makes it more attractive the other can suffer and you tend to see a large flow of money from one to the other very rapidly.

For those who are not aware, carry trading is a process where an investor borrows money in a currency with a very low interest rate (e.g USD) and shifts it to one with a much larger one (e.g AUD), making a difference on the two. When Australian economic data is poor or the U.S has some good news, you tend to see what is known as the ‘unwinding’ of carry trades, leading to the Australian Dollar weakening and the U.S Dollar gaining strength due to supply and demand.

Personally, I feel that the 1.60 rate will not be hanging around much longer and I would not be surprised to see a rise for the Pound, although be wary of Sterling getting the jitters in the next week or so as we close in on article 50 being triggered on 29th March, this is the official start of the process of the U.K leaving the EU.

For anyone with a large currency exchange to make, either involving buying or selling Australian Dollars it is imperative that you have a proactive and knowledgeable currency broker on your side throughout these turbulent times.

If you would like my assistance then feel free to contact me (Daniel Wright) the creator of this site and I will be more than happy to get in touch to discuss the various options available to you in simple terms. You can email me on djw@currencies.co.uk and I will be more than happy to contact you personally.

What next for GBPAUD exchange rates?

The pound spiked impressively against the Australian dollar yesterday as the Bank of England indicated the possibility of higher interest rates to help maintain Inflation. The Australian dollar was actually weaker too on the back of Unemployment data which reflected a much weaker Unemployment picture than previously thought. If you are looking to make a transfer in the coming months and weeks than understanding just where the Australian economy and the UK’s Brexit negotiations are headed is key.

The Australian economy has been buoyed by rising commodity prices and continued solid Chinese economic growth and investment. The higher interest rates in Australia also offer investors are solid platform to invest in presenting much greater returns than the in some case negative offerings from elsewhere. Whilst the United States raising their interest rate this week did help the Australian dollar a little more, the Aussie lost ground to rise back above 1.60 on GBPAUD.

I personally think the rate will struggle to maintain itself above 1.60 as the pending UK Brexit negotiations and fears are likely to unsettle the pound. Most commentators believe the triggering of the Article 50 clause will see the pound weaken but I believe we might see some small improvements in the value of sterling here, although ultimately they will prove shortlived.

If you have a transfer to make buying or selling Australian dollars we are a very important time. With rates hovering around 1.60 the prospect of events getting even worse for Australian dollar buyers is highly likely. Clients buying Australian dollars hoping that this is a ‘bottom’ in the recent trends could be in for a nasty shock if we hit 1.55 or worse in the coming weeks.

Many clients said it was painful to buy at 1.80 and even 1.90 last year failing to believe us when we said it would get worse. Some clients also failed to believe us when we had rates above 1.70 and we predicted it would get worse. The global conditions that contributed to the GBPAUD rates sliding to some of the lower levels in the last few years remain and I think Australian dollar buyers need to be very careful about having expectations that are too high.

To discuss the currency markets and all of your options with a currency specialist with almost ten years experience handling the personal and business requirements of thousands of clients in Australia and the UK, pease contact me Jonathan Watson on jmw@currencies.co.uk or call 01494 787 478 in UK business hours. 

GBP/AUD Rates Fall Below 1.60! (Matthew Vassallo)

GBP/AUD rates have fallen below 1.60, with the AUD gaining support ahead of the UK’s Brexit.

The AUD gained momentum during Wednesday’s trading session, pushing rates under the 1.60 resistance level. This has provided those clients holding AUD with another fantastic opportunity to sell their positions, as uncertainty surrounding the UK economy continues to help support the AUD’s value.

The move under 1.60 was also supported by the US FED’s decision to raise interest rates in the US, a result widely anticipated by investors.

It was somewhat surprising to see the AUD strengthen as a result of this, as typically you see it weaken as the AUD is considered a riskier currency. However, last night’s move proves that the current sentiment regarding the Australian economy is positive and the uncertainty surrounding the UK economy is still very much a negative in the eyes of investors.

The Australian economy has released a run of positive economic data and last night’s official Unemployment figure showed a fall from 5.9% to 5.7%. This is another reason the AUD has managed to break through 1.60 but despite the current positive trend I am still wary about assuming the current spike will continue at the same pace.

The UK is fighting an uphill Brexit battle and has done for many months but with Article 50 on the verge of being triggered and layers of uncertainty regarding future policies slowly being removed, the Pound may start to gain a foothold sooner rather than later.

We also need to remind ourselves that the current market remains unpredictable at best and with global investor confidence fragile, commodity based currencies such as the AUD are also at risk. They are reliant on global growth, in Australia’s case particularly the export of its raw materials to China. Therefore, any slowdown in this sector will always hit their economy hard and the AUD will inevitably suffer as a result.

If you have an upcoming GBP or AUD currency transfer to make, then we can help you navigate this turbulent market by keeping clients up to speed with all the latest developments regarding Brexit and beyond.

If you would like us to monitor the market for you ahead of a currency exchange, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me directly on 0044 1494 787 478 and ask one of the team for Matt.

Alternatively, I can be emailed directly on mtv@currencies.co.uk.

 

A volatile evening for Australian dollar exchange rates (Dayle Littlejohn)

For Australian dollar buyer and sellers this evening should be a volatile night for exchange rates for a few reasons. Firstly the Federal Reserve in the US are set to release their latest interest rate decision and many economists believe a rate hike is on the cards. If this occurs, I expect speculators to leave the Australian dollar and purchase US dollars in order to profit take. However if the FED decide to hold off expect the opposite and the Australian dollar could actually strengthen.

Later in the evening Australia are set to release a host of data including Unemployment rate, Employment change, RBA bulletin, Participation rate and Consumer inflation expectations. The two key releases are the Unemployment numbers and Employment change. With Unemployment expected to remain steady at 5.7% and Employment change numbers suggesting a slight rise, this could lead to the Australian dollar gaining strength. Therefore I wouldn’t be surprised to see Australian dollar exchange rates up and down like a yo-yo this evening.

As for GBPAUD exchange rates, I believe its only a matter of time until GBPAUD breaks through 1.60, therefore if a spike occurs this evening for Australian dollar buyers I would recommend seriously considering taking advantage. The reason why I believe rates will fall into the 1.50 is due to UK Prime Minster Theresa May’s announcement that she will trigger Article50 at some point this month.

For people that buy and sell Australian dollars on a regular basis or are looking to make a one off transfer, the currency company I work for can save you money. Feel free to send me the reason for why you are converting currency, the currency pair you are trading (AUDGBP, AUDUSD), and the timescales you are working to and I will send you my forecast and the process of using our brokerage drl@currencies.co.uk.

 

US Interest Rate Hike could weaken the Australian Dollar (Daniel Johnson)

Could there be an Investor Exodus from the Australian Dollar?

The Australian Dollar has strengthened significantly against the pound of late. There has been positive figures from Australia coupled with the uncertainty surrounding Brexit. Data has been so good in fact, Australia has recently overtaken Holland for having the longest successive period of growth without recession. Wednesday could however be an opportunity for Sterling sellers.

Wednesday will see the Federal Reserve US interest rate decision. It has been widely publicised there is the strong possibility of a rate hike. Odds of a hike currently sit at 80%. If the hike occurs, the Australian Dollar will certainly lose appeal to the investor. With higher levels of safety and now higher returns than previously, the US dollar could well be the destination of choice. We could see significant Australian Dollar weakness following the rate decision.

Brexit Update

The House of Lords have put forward two amendments to the exit bill. They wish to have a vote by MP’s on the final bill and they would like the rights of current EU citizens residing in the UK protected.  The bill has to be approved by the House of Commons, however if the amendments are rejected, there is the possibility that article 50 could be triggered as early as midnight this evening. This would definitely be a shock to the markets and you could expect high volatility on the exchange.

Trading GBP/AUD?  – Be sure to be in touch with a Broker if you want the most for your money

If you have a currency requirement it is vital to have an experienced broker on board to assist with your trade. It will be extremely difficult to maximise your return during such volatile times. I can provide an individual trading strategy, picking the correct contract to suit your needs. I am also prepared to perform a comparison against your current provider and I very confident I will be able to show you a significant saving. Let me know the currency you are trading, the size of your trade and timescale and I will endeavour to get back to you as quickly as possible. You can trade in the knowledge that you will working with a brokerage in the business for over 16yrs and one that is FCA registered. I can be contacted at dcj@currencies.co.uk. I look forward to hearing from you and thank you for reading.

 

 

Will GBPAUD slip below 1.60?

The pound to Australian dollar rate is on a lower trajectory as sterling comes under renewed pressure and Australian economic data continues to perform well. Most analysts feel sterling will move lower so I feel rates under 1.60 will soon once again be a very real possibility presenting even better opportunities for clients looking to sell AUD for the pound.

Most of the focus on the Australian dollar has centered around the likelihood of further interest rate cuts or hikes down under. With the Australian economy very close to breaking the record for the longest recession-free economy it ties in quite fairly that the currency would perform well. Despite the prospect and outside chance of further interest rate cuts down the line I think the currency will remain very strong. The Australian dollar enjoys lots of favour because of the high interest rates on offer, offering a much better proposition for clients looking to secure a good return.

With the UK about to trigger Article 50 the main focus of the markets will be on sterling which will be the big driver. Unfortunately for Australian dollar buyers waiting around to pick up patchy pockets of Australian dollar weakness is unlikely to do anything material to them to help avoid the harsh reality of a much weaker pound following Article 50 being triggered.

Next week is Unemployment data for Australia which if worse than expected could present some slightly better opportunities for greedy Aussie dollar buyers who missed the boat earlier this year. But with some major political changes under way in the UK a move below 1.60 seems the great chance for short term movements on this ever uncertain pair.

For more information at no cost or obligation please speak to me Jonathan on jmw@currencies.co.uk. I work as a specialist currency broker and can help you with the planning and execution of any transfers you will need to consider for the future.

Where Next for GBP/AUD Exchange Rates? (Matthew Vassallo)

GBP/AUD rates have remained fairly flat during Thursday’s trading, with the pair floating around 1.62.

The AUD has performed well this week against Sterling ,as pressure continues to build on Sterling ahead of the UK’s upcoming Brexit and the triggering of Article 50 later this month.

Much of this week’s focus has been on yesterday’s UK budget and as expected the new Chancellor was bullish in his address.

Despite the outcome being underwhelming for those clients holding the Pound, there were positive noises being made regarding future growth forecasts for 2017, which were raised form 1.4% to 2%.

There is also on-going talk of a Brexit ‘pot’ being put aside to help alleviate pressure on the UK economy, following the triggering of Article 50. This is still on course to be actioned this month, despite some speed bumps being put down by the House of Lords. Whilst there was talk of up to 60bn being put aside as a safety net no official figures have been confirmed and as such it will be interesting to note how this story develops as it could have a significant impact on Sterling’s value.

As it stands the Pound is still struggling to make any significant inroads against the AUD, which is still threatening to make a move towards 1.60. This level will be hard to breach and is likely to provide some resistance for Sterling but there is no doubt the UK economy remains fragile in investors’ minds and the AUD is benefiting as a result.

The current market remains unpredictable at best and with global investor confidence fragile, commodity based currencies such as the AUD are always at risk. This always leaves them open to risk as they are reliant on global growth, in Australia’s case particularly the export of their raw materials to China. Therefore any slowdown in this sector will always hit their economy hard and the AUD will inevitably suffer as a result.

For this reason I have been advocating that my clients look for short-term spikes rather than hold out for sustainable gains in such uncertain and volatile times.

If you have an upcoming GBP or AUD currency transfer to make, then we can help you navigate this turbulent market by keeping clients up to speed with all the latest developments regarding Brexit and beyond.

If you would like us to monitor the market for you ahead of a currency exchange, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me directly on 0044 1494 787 478 and ask one of the team for Matt.

Alternatively, I can be emailed directly on mtv@currencies.co.uk.