Tag Archives: australian dollar exchange rates

Australian Dollar to Pound Rates Strengthen on Hope of Positive G20 Summit (James Lovick)

Pound to Australian dollar exchange rates have fallen lower to below 1.75 for the GBP AUD pair as Brexit uncertainty remains the biggest threat to the pound ahead of the parliamentary meaningful vote around the 12th December. There are reported 100 Conservative MP’s who have signalled that they will vote against the Prime Minister which leaves an even more uncertain period ahead. If the Prime Minister is unable to push forward with her Brexit deal then there are a number of different outcomes. A second vote in the House of Commons is perhaps the most likely outcome although a change of Prime Minister, a second referendum, a no deal Brexit or a Norway style trade deal cannot be ruled out.

The EU have stated that this is the best deal the UK will receive so in the event that Theresa May is unable to secure a better deal then the prospect of no deal in my view is starting to look much more likely to happen. The Bank of England has made worst case scenario predictions that there could be a crash in the pound of up to 25% which is making the price of sterling extremely sensitive to political developments in the UK.

The Australian dollar could also see a substantial boost if there is a breakthrough or at least a statement of intent for the US and China to reduce tariffs on trade and come to a future trade agreement. The Australian dollar could be big beneficiary if progress is made at the G20 summit this weekend where a slot has been put aside for US China talks. We’re not there yet and US President Donald Trump has been threatening more tariffs this week so it remains to be seen how constructive these talks will be if talks don’t well and tariffs are imposed on all Chinese goods then the Aussie could weaken considerably lower as those concerns grown on the future of global growth.

For more information on the Australian dollar exchange rates and for assistance on making transfers either buying or selling Australian dollars then please feel free to contact me James at jll@currencies.co.uk

GBP to AUD Exchange Rates Uncertain ahead of EU Summit 25th Nov (James Lovick)

Pound to Australian dollar exchange rates remain on the back foot as uncertainty over Brexit continues to the big driver for GBP to AUD rates. The pound is trading at just over 1.76 against the Australian dollar and whilst there has been some support this week any major improvement is likely to be limited for the pound. UK Prime Minister Theresa May is still trying to seal a deal on the political declaration for the future trading relationship between the UK and EU and a meeting last night failed to provide a breakthrough. Theresa May will now fly back to Brussels on Saturday ahead of the emergency EU summit which commences on Sunday.

The political declaration will be an important component to the deal and the specific wording of the text will help determine whether parliament will vote in favour of the deal that is almost on the table. Ultimately it will all come down to a meaningful vote in parliament on the final deal which will decide the future of the UK and the pound in the short term. It leaves a very uncertain few weeks for sterling exchange rates whilst the markets await this key vote in parliament.

The Australian dollar could come under some renewed pressure in these coming weeks as the issue of trade wars continues to impact on global markets. So far there has been no compromise for a future trade deal between the US and China as preparation are being made behind the scenes for a summit in Buenos Aires. Relations are likely to become even more tense as both Europe and China seek to argue that Donald Trump cannot continue to impose tariffs on steel and aluminium on the basis of national security.

The World Trade Organisation (WTO) will need to rule on this subject and the outcome will likely create added turmoil in the financial markets. If for example the WTO challenged the US on this point then in an extreme scenario the US could find itself breaking away from the WTO entirely. This could see a flight to safety to the US dollar leaving the Australian dollar in a risky position. Once again there is another focal point in the diary which will help direct GBP vs AUD.

For more information on Australian dollar exchange rates and how to find the optimum time to convert funds either buying or selling Australian dollars then please feel free to get in touch with me James at jll@currencies.co.uk

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

Sterling Falls Lower against Australian Dollar – Brexit Jitters (James Lovick)

The pound has fallen even lower against the Australian dollar with rates briefly falling below 1.73 for the GBP AUD pair. The Australian dollar outlook isn’t looking that great at the moment with the ongoing trade war between the US and China. Only yesterday the US agreed a further 25% tariff on Chinese imports worth $60 billion. China is likely to retaliate further and it has even been reported that President Donald Trump is considering putting tariffs on everything the US imports from China which equates to about $500 billion. Already the Chinese stock markets are taking the brunt of this and if China does move into a downturn then this could end up harming the Australian dollar. Australia’s major export iron ore is sent to China in large volumes for steel production and so any global slowdown could see demand for this commodity fall sharply proving negative for the Aussie as a commodity currency.

The Reserve bank of Australia will be releasing the Monetary Policy Statement tomorrow which could offer some more clues as to when then the central bank may look to raise interest rates again. Although the next move is anticipated to be upwards the next hike is likely to be someway off yet.

Despite the above the pound has still managed to fall considerably lower against the Australian dollar this week although this is down to Brexit uncertainty in the UK following comments from both Bank of England Governor Mark Carney and Trade Secretary Liam Fox. Both have suggested there is a strong likelihood of a no deal Brexit which is spooking the markets and seeing the pound tumble. Until clarity is offered which is not likely to come until after the summer parliamentary recess the pound could see further losses. If the UK & EU cannot agree in the coming months on a withdrawal agreement then sterling is likely to fall lower.

For more information on Australian dollar exchange rates and how to achieve the best rates for buying or selling dollars then please get in touch with me James at jll@currencies.co.uk

Australian Dollar Boosted on Stronger Retail Sales (James Lovick)

The Australian dollar has been boosted following a jump higher in Australian retail sales which saw the best performance in over a year. The better data signals a buoyant consumer market which should lend support to the Australian economy. The numbers jumped 1.2% for the last quarter which is considerably higher than the 0.8% that was expected and welcome news in that Australia has also suffered with weak wage growth which has been squeezing pockets down under.

The Reserve Bank of Australia meet on Tuesday to discuss interest rates although there is unlikely to be any change at this meeting. Interest rates are currently set at 1.5% and whilst no change is expected any comments following the meeting from RBA Governor Philip Lowe could see a market reaction for the Aussie.

Rates for GBP AUD are currently hovering around 1.75 for the pair and testing the lower levels seen in its recent range. Much of the slide has stemmed from the uncertainty in the UK over Brexit in recent weeks. Despite an interest rate increase last week from the Bank of England the pound has actually fallen after Governor Mark Carney suggested that the chance of a no deal Brexit was uncomfortably high. The pound has been trading on the back foot following on from his comments which have made the markets uneasy hearing this from the top. Until clarity is offered the pound is likely to remain under pressure against the Aussie. There is currently a good opportunity to sell Australian dollars for pounds and any additional uncertainty on Brexit could see the pound weaken further. British politics have gone into sleep mode with the summer parliamentary recess but expect more volatility for the pound towards the end of the month.

For more information on Australian dollar exchange rates and for assistance in making transfers at the best rates then please get in touch with me James at jll@currencies.co.uk

Australian Dollar Outlook Improves (James Lovick)

The Australian dollar could be set for a stronger period ahead following a series of better economic data helping support the Aussie. Unemployment data released this week arrived better than expected at 5.4% against consensus of 5.5% proving beneficial for the dollar. There is hope that the improvement in the labour market should start to feed through into higher wage growth which is something the Reserve Bank of Australian have been waiting for. The Aussie was also boosted on the back of higher consumer inflation expectations which are pointing to higher prices down under going forward. The data suggests that Australians expect prices for goods and services to climb higher and this is yet another key criteria the RBA are monitoring before any decision is made on potentially raising interest rates. Looking forward the dollar could see a better period ahead and clients looking to sell Australian dollars may see a good window to convert within the next couple of months.

Next week sees the RBA minutes for the meeting earlier this month and may offer clues as to the central banks thinking. Any suggesting the conversation is moving towards raising rates would be seen as good for the Aussie.

The US are widely tipped to impose more trade tariffs on China imminently and this could happen as soon as today. Australia for the moment appear to be relatively protected for this action due to the strong trade ties it has with China.

GBP AUD

There are two major drivers for the GBP AUD pair at present. Clients looking to buy or sell Australian dollars should be aware of the Bank of England meeting next week as any change of tact from Governor Mark Carney could see the pound react. Any suggestion a rate hike could happen in August is likely to see rates for GBP AUD rally. Perhaps more importantly the Brexit withdrawal bill goes back to the House of Lords on Monday after there has been some disagreement in government as to the final wording of the text. This could prove tricky for the Prime Minister and any political tensions here could see the pound come under pressure. My long term view of GBP AUD is for considerable strength so sellers may wish to strike whilst the opportunity is still there.

For more information and guidance on Australian dollar exchange rates and for assistance in making transfers at the right time then please feel free to contact me at jll@currencies.co.uk

GBP AUD Exchange Rates Rally on Uncertainty for Commodity Currencies (James Lovick)

The Australian dollar has weakened again after coming under pressure from the recent trade tariffs being imposed by China and the US. The Australian dollar as a commodity currency is impacted negatively when there is a threat to global growth and that risk is very real in the current climate. With tit for tat trade tariffs being imposed by both nations there have been concerns that things could escalate and end up in a global trade war.

Chinese President Xi Jinping made a conciliatory speech this morning and even suggested opening trade which would include a reduction on import tariffs on vehicles and even hinted at encouraging imports. It follows a tweet from Trump yesterday which highlighted that China has been slapping on tariffs to the tune of 25% whilst in the US that tariff has only been 2.5%

I don’t think anyone is expecting a fully blown trade war but there is still some nervousness about the trade disputes which also moves into the realms of the NAFTA trade agreement between the US, Canada and Mexico. The Canadian dollar is another commodity currency also feeling the pinch and how Trump handles these negotiations will almost certainly have a knock on effect on the Aussie.

Those clients looking to buy Australian dollars with pounds could see some more positive movement as the trade disputes intensify but at some point an outcome should be reached and this should be beneficial for the Aussie. Rates for GBP AUD are hovering around 1.83 and are proving to be some of the best levels we have seen for some time. A rally in commodity prices on brighter global outlook could see material gains for the Aussie and reverse the good gains that have been witnessed.

For more information on Australian dollar exchange rates and assistance in making a transfer either buying or selling Australian dollars then please get in touch with me at jll@currencies.co.uk

Buying Australian Dollars with Pounds? (James Lovick)

Those clients looking to buy Australian dollars have seen a great spike this week for the GBP AUD pair. Rates for GBP AUD have broken over 1.83 although the recent rally appears to be running out of steam. The pound has been given an excellent boost after agreement was reached between Britain and the EU on a transitional deal in the Brexit negotiations. The pound has benefitted from this as a degree of confidence for British business has been restored and this is seen as welcome news for the British economy.

Clients looking to buy Australian dollars would be wise to consider taking advantage of the current highs as spikes likes these in recent months have so far proved very short lived. There are a number of thorny issues which will resurface in the coming weeks and revolve around the Irish border and financial services.

If no agreement is reached over the Irish border and if a deal cannot be found which includes financial services for the city of London then the prospect of a no deal scenario suddenly starts to look considerably more likely. It is for this reason that any gains beyond these levels seem unlikely in the short term at least.

Clients looking to sell Australian dollars should see some spikes in the coming weeks and months although my view is that a deal on Brexit will be reached and this could see the pound perform very well. A move towards 1.90 for GBP AUD cannot be ruled out in these markets especially as the Brexit appears to have finally turned a corner with an apparent accord and will to move forward from all sides.

For more information on Australian dollar exchange rates and how to make the most of these opportunities in this volatile period then please get in touch with me at jll@currencies.co.uk

GBP AUD Breaks over 1.73 ahead of Bank of England Meeting (James Lovick)

GBP AUD exchange rates have seen an excellent boost with rates breaking over 1.73 for this pair today. There is currently an excellent opportunity for those clients looking to buy Australian dollars as present. The Australian dollar has come under pressure in recent weeks following the very dovish set of minutes from the Reserve Bank of Australia (RBA).

It is now very unlikely that there will be an interest rate increase any time soon. The earliest rate increase is likely to be some time at the end of 2018 or possibly even into 2019 which is helping see the Aussie weaken. Despite the strength of the Australian economy and bearing in mind that it has been over 25 years since the last recession down under the Australian dollar is seeing some weakness at present and this stems from the tone coming out of the RBA. It is well known that the RBA has raised concerns over the recent strength of the Aussie and has openly made clear its view that it would like to see the currency weaken and this appears to be filtering through into the exchange rate.

As far as GBP AUD is concerned the pound has also received a boost in the last week. The stronger Gross Domestic Product (GDP) numbers have helped lift sterling in what has been a very uncertain 16 months following the Brexit vote in June 2016. The Bank of England meet on Thursday and there is a strong chance that there will be a hike by 0.25% taking levels back up to 0.5%. Clients looking to buy Australian dollars with sterling may wish to consider locking in at the current better levels. There is a risk that if the central bank does not rise rates on Thursday then the pound could fall lower.

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

Why does the Australian dollar remain strong when iron ore prices continue to fall?

For regular readers they will be aware that Australia’s largest export Iron ore has a direct impact on Australian dollar exchange rates. If iron ore prices fall the trend is for the Australian dollar to fall and vice versa. However, iron ore prices have been falling recent however Australian dollar exchange rates remain resilient. There are two main reasons for this.

Another trend that has an impact on Australian dollar exchange rates is the performance of emerging markets. When emerging stock markets outpace that of developed the Australian dollar also performs well. In recent months emerging markets have been performing well and forecasters expect this trend to continue. In addition, interest rate forecasters tend to disagree with the RBA as they believe the RBA will hike interest rates throughout 2018.

Commentary from the Reserve Bank of Australia, I believe will continue to dictate exchange rates   therefore people with an upcoming Australian dollar exchange should continue to monitor developments.

Economic data releases that will impact Australian dollar exchange rates 

In the early hours of Tuesday morning the RBA are set to release their latest minutes. My personal opinion is that the Governor does not want to strengthen the Australian dollar any further and thats why he continues with the stance of interest rates won’t be raised anytime soon. It will be interesting to see if the minutes give any further insight.

Later in the week (Thursday) the latest unemployment numbers will be released. Over the last 3 years the Australian job market has gone from strength to strength and at present remains at a record low of 5.6%. The Governor of the RBA is wary that if the Australian dollar continues to strengthen the job market could be impacted however for the time being it looks like the unemployment numbers will remain at 5.6%.

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 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.