Tag Archives: AUD forecast

AUD Forecast – Economic Crisis in Turkey is Negatively Impacting the AUD (Matthew Vassallo)

Sterling has made inroads against its AUD counterpart over the past few days, with GBP/AUD rates moving back above 1.76.

The AUD and other commodity-based currencies have seen their value dip, since the Turkish economic crisis deepened towards the later part of last week.

The Turkish Lira (TYR) has hit record lows against the USD, with inflation levels in Turkey hitting a staggering figure of 15%. The Turkish stock market has fallen by over 17%, causing investors to panic, whilst also sapping their risk appetite.

When the global markets stutter and investors risk appetite falls, usually commodity-based currencies feel the negative effects first. These are considered riskier assets by investors, which are generally sold-off in times of global market uncertainty. This is one of the reasons why the Pound has made inroads against the AUD over the past few days but the key question now, is how much higher is Sterling likely to go?

With UK Prime Minister Theresa May on holiday, Brexit talks will remain on hold until her return. This means that the current crisis in Turkey is likely to dominate headlines over the coming days, which could lead to further pressure on the AUD.

The UK economy also received a boost this morning, following the release of the latest UK Unemployment data. The official Unemployment Rate fell to 4%, which could also help to support GBP around its current levels.

Moving forward and the markets concerns over Brexit have not disappeared and are likely to resurface before long. Therefore, if I was holding Sterling and looking to buy AUD, I would be keeping a close eye on market developments in the short-term, rather than holding out for any longer-term sustainable gains.

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.

Australian dollar rises slightly on RBA decision and a more positive outlook!

The Australian dollar has strengthened slightly on a more positive backing from the RBA, Reserve Bank of Australia. By not being too dovish or soft in their outlook, the Australian dollar has risen. The market is loosely expecting an interest rate hike in the future but this could now be as far ahead as 2020! Some had expected the RBA to be more negative last night, however they were quite positive about the Australian economy.

This has seen the Aussie dollar rise against all currencies, notably the pound and even the US dollar. GBPAUD has been driven into the 1.74’s whilst AUDUSD has risen to 0.7430. Expectations for the Australian dollar centre around the progress of their economy, Governor Lowe will give a speech later this week which could see further news to move the Australian dollar.

Last night’s interest rate decision moved the market as it was more positive than many had expected. It is now believed that in the future the global trade wars which have been raised as a concern which might negatively impact the Australian dollar, may not been such bad news. Tracking the data from China and the commentary from the RBA shows that perhaps this issue will not be as detrimental for the Australian dollar as believed.

Whilst stating they were not overly concerned at the moment from the slowdown in China, this was highlighted as a potential issue for the future and this could well be something that weakens the Australian dollar in the future.

If you need to buy or sell Australian dollars getting the best information is key to being able to track the upcoming news which might move the markets. For more information on the latest trends and themes which will influence the value of your exchange, please speak to me Jonathan by emailing jmw@currencies.co.uk

Where next for GBPAUD exchange rates?

Australian dollar exchange rates will now be moving into a potentially volatile week as we get a series of major tier releases which could well move the currency markets. Most notably, on GBPAUD we could see big movement from the UK Bank of England interest rate decision on the 2nd August as well as on the evening of 1st when we get the latest US interest rate decision. With both decisions having such a dramatic effects, what can we expect  on the GBPAUD pairing?

Interest rates are a key driver on the Australian dollar and it is the raising and lowering of the central bank’s levels which causes the movements on the currency markets. Just like a higher interest rate will make a savings account more attractive to invest in, a higher interest rate on a currency will make that currency more attractive to hold.

A big driver on the Australian dollar has been the raising of US interest rates with the US dollar gaining in strength as the US Federal Reserve raise their base rate. With the US interest rate now higher than the Australian one, the Australian dollar has weakened as funds and investments are moved from the higher yielding Australian dollar to the now higher yield US dollar.

This move weakens the Australian and has seen GBPAUD level rising in recent weeks although just lately GBP weakness has dragged the pair back down lower. Expectations for next week and the two key central bank decisions could easily GBPAUD levels back towards 1.80. This would be if the US raise rates which would strengthen the US dollar and weaken the Australian. We would probably also need to see the Bank of England also raise rates too, to see the level above 1.80.

Some analysts, myself included, are sceptical over the Bank of England raising rates. If they fail to raise or perform a soft raise, which essentially writes out any future hikes, we could then see the pound drop. With much of the good news priced into a possible hike, it seems that clients holding on to see the pound rise could once again end up disappointed.

For more information on the best potential strategies to maximise your position please contact me Jonathan Watson by emailing jmw@currencies.co.uk

Australian Dollar continues to lose value as inflation levels stall

The financial markets don’t expect to see the base rate of interest change down under until the end of next year according to futures markets, and this is perhaps one of the reasons behind the Aussie Dollars weakening currently.

If the Reserve Bank of Australia (RBA) doesn’t amend rates the AUD will lose competitiveness as we’ve already seen, as the likelihood of investors holding assets in the currency diminishes owing to the less competitive of the currency. The US Dollar on the other hand has benefited greatly from its more aggressive monetary policy and the greenback has strengthened by such an extent that US President, Donald Trump has voiced his concerns.

The latest bout of Inflation data out of Australia shows that inflation has risen by 2.1% over the past year, which is slightly lower than what economists were expecting. There doesn’t appear to be much momentum regarding Australian inflation levels which is perhaps the reason behind the low expectations of a rate hike in the short-term future.

Although the Pound has been under pressure in recent months owing to the Brexit plan uncertainty, the Pound to Aussie Dollar rate is still towards the top end of it’s longer term trend, which demonstrates the pressure AUD exchange rates have come under. The GBP/AUD pair is likely to be driven by both monetary policy and UK based politics as the UK is going through a crucial time due to the Brexit.

Those monitoring the Aussie Dollars value should also pay attention to US President, Donald Trumps trade tariff’s plans as AUD has come under pressure owing to these concerns. With the Australian economy being reliant on global demand a slowdown to the global economy is likely to have a negative impact the Australian Dollars value.

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.

Hawkish Bank of England comments push the Pound higher, will GBP/AUD breach 1.80 again soon?

Despite the Pound to US Dollar rate trading at a 7-month low against the US Dollar, the currency has actually been boosted against most major currency pairs today.

The reason for the boost to the Pound to Aussie Dollars value can be put down to the Bank of England’s comments and the voting pattern of the Bank of England members. The Aussie Dollar lost a lot of value against the Pound today which is why the focus of this blog is on that particular pair.

There are now 3 members of the Bank of England that wish to increase interest rates in the UK, and this is one of the reasons for today’s boost to Sterling exchange rates. The highest the GBP/AUD pair have hit today is 1.7979 although the pair have since slipped off which to me demonstrates that there may be resistance at the 1.80 mark as we’ve previously seen.

There isn’t expected to be any rate hikes from the Reserve Bank of Australia until next year, so I do think that the Pound will climb against AUD should the hints at a rate hike later in the year from the BoE materialise.

With a quiet end to the week in terms of data I’m expecting to see AUD exchange rates driven by sentiment.

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.

Weak data results in a drop for the Aussie Dollar, where to next for AUD exchange rates?

There’s been a loss for the Aussie Dollar across the board of major currency pairs today, with it’s losses against the Pound and the Japanese Yen being the biggest.

Employment figures down under for May were released this morning, and that caused the Aussie Dollar to drop as the figures released were worse than expected. The figures have got worse in recent months which is another reason for the sell-off of the Aussie Dollar.

Some disappointing data out of out of China recently has also weighed on the Aussie Dollars value, owing to the close trading relationship between the two nations. This isn’t an unusual pattern and those planning on making a currency exchange involving the Aussie Dollar should consider this in future.

The poor data out of China has caused China-linked commodity prices and also the Chinese stock market to fall, and this isn’t a great sign for the Aussie Dollar moving forward. Fears surrounding the trade tariff’s potentially put on China by the US are also weighing on AUD exchange rates.

There’s a speech planned by Reserve Bank of Australia assistant Governor Ellis tomorrow. Although no changes to monetary policy down under are expected this year its worth following his comments in case he alludes to future monetary policy changes or even the slowdown in the Australian economy recently.

If you would like to be notified in the event of a major market move for AUD exchange rates, 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.

 

Brexit uncertainty continues to hurt the Pound (Daniel Johnson)

GBP/AUD – Sterling remains fragile due to the lack of clarity surrounding Brexit and poor economic data. If there is progress in Brexit negotiations expect the pound to rally. Unfortunately very little progress is being made. The current point of contention is the Irish border deal. At present Theresa May and David Davis are unable to even agree on a back up deal if a deal on the Irish border cannot be reached. Ideally they would like to have something in place before the EU summit on 28th June. The current situation does not bode well for Sterling.

Recent data releases continue to be poor, manufacturing data this week saw the biggest fall since October 2012 and GDP came in below expectations at 0.2%. Average wage growth also saw a decline, unemployment remained unchanged, but it is important to remember that zero hour contracts are not a stable form of employment.

I am of the opinion there is little justification for a rate hike from the Bank of England (BOE) in the coming months and would be surprised to see one this year.

Thing are not all rosy down under however. Australia is heavily reliant on China purchasing it’s raw materials, particularly iron ore. The ongoing trade war with China and US is a concern. If China’s growth drops, so will the demand for Australian goods and services which will hit the Australian economy and in turn the Australian Dollar.

There are economists with the view there is the possibility of a rate hike from the RBA this year. I am not so confident.

If you are buying Aussies GBP/AUD is currently range bound between 1.75-1.80. Aim for 1.77 + if you have to move short term.

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker if you wish to maximise your return. If you let me know the details of your trade I will endeavour to produce a free, no obligation trading strategy for you. If you have a trade to perform I will also happily provide a free quote and I am confident our rates are among the best in the industry. I would be willing to demonstrate this in form of a comparison with any competitor. You can trade in safety knowing you are dealing with company FCA registered and one that has been trading for 16yrs. Foreign Currency Direct PLC.

If you would like my assistance I can be contacted at dcj@currencies.co.uk. Thank you for reading. Daniel Johnson

 

AUD Forecast – Fears Over Brexit Continue to Support the AUD (Matthew Vassallo)

It’s been a quiet start to the week for the AUD, following yesterday’s bank holiday in Australia.

GBP/AUD rates have remained range bound over recent days, with little market movement despite the developments in the Korean peninsula.

Almost every headline this morning relates to the historic meeting between President Donald Trump and Korean leader Kim Jong-Un.

Whilst we are still waiting for the full details of the deal that has been put in place, both Trump and Kim confirmed that they had signed a document that has committed North Korea to complete denuclearisation.

Whilst this deal has no direct impact on the Australian economy, the repercussions are likely to have ripple effects across the global economy.

The AUD has performed well of late, particularly against its GBP counterpart, finding plenty of support around the current levels. Whilst GBP/AUD are trading around 1.76 this morning the pound has not threatened to make any sustained move towards 1.80 over recent weeks.

Sterling continues to be handicapped by concerns over Brexit and with today’s House of Commons debate will be followed closely by investors, a positive resolution in the short-term seems optimistic at best.

This uncertainty is helping to support the AUD around the current levels and with yesterday’s poor UK Manufacturing data a real for cause for concern, I am not anticipating a major shift in Sterling’s favour over the coming days.

If you have an upcoming GBP or EUR 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.

Australian Dollar predicted to rise as global economy picks up

The Australian Dollar has been strengthening in recent weeks, with the GBP to AUD exchange rate being a good example of how much AUD has strengthened after the rate has dropped from around 1.85 to around 1.75 over the last few months.

A number of analysts have begun to adopt a hawkish outlook for the Aussie Dollar moving forward, and the HSBC chief economist for Australia and New Zealand is the most recent key figure to share this view. His name is Paul Bloxham and he’s cited the largest increase in 6 years for the counties GDP as a key indicator as to the health of the economy.

A global pick up will benefit the Aussie Dollar due to its export driven economy, but I also think its important that our readers are aware of the importance of the countries services sector as its now more important to Australia than its mining sector.

Next week on Thursday there will be a number of key releases out of Australia, mostly covering the health of the countries employment sector. If you would like to plan around this event do feel free to register your interest with me.

The economy is likely to remain resilient in the face of trade wars breaking out, due to its close trading relationship with China. One downside though is that the RBA doesn’t plan on hiking interest rates until next year, meaning that the currency may lose some of its competitive edge.

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.

 

AUD Forecast – RBA Keep Interest rates on Hold at 1.5% but Central Bank Remains Upbeat (Matthew Vassallo)

Anyone with an upcoming AUD currency exchange to execute, will need to keep an eye on a number of key economic data releases this week.

Monday saw the release of the latest Retail Sales figures, which came in at 0.4% and above the markets predicted result. This helped to solidify the AUD’s position against a host of major currencies, including the Pound. If it wasn’t for some better than expected UK Construction data, we may have seen the AUD make further inroads back towards 1.70 against Sterling, but as it stands currently, GBP is finding a fair amount of support around 1.74.

The market data is coming thick and fast this week and yesterday’s Reserve Bank of Australia (RBA) interest rate decision, would have been of key interest to investors, who were hoping to predict the AUD’s next movements.

As expected the central bank kept interest rates on hold and at record lows of 1.5%. This in itself does not tell the whole story, as this decision was widely anticipated and likely factored into the AUD’s value prior to last night’s release.

It was the RBA’s subsequent monetary policy statement that was always likely to hold he most weight with investors and the RBA, somewhat typically some may say, remained optimistic regarding their current economic outlook.

They expressed confidence in the economies ability to extend its 26-year run without entering a recession, citing stronger exports and government spending as the reasoning behind this.

This positive stance will most likely help to curb any short-term losses for the AUD but has yet to make any major impact during today’s trading.

With much of the medias focus currently on President Trump and the prospective trade tariffs that he is looking to impose, fears over a slowdown in global trade continue to grow.

If this occurs it will most likely put pressure on commodity-based currencies such as the AUD and as such, investors are most likely remaining cautious regarding their approach.

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.