Tag Archives: australian dollar forecast

FED and EU Summit to drive GBPAUD exchagne rates

This week, events that are not directly involved with Australia and the United Kingdom will dictate GBPAUD exchange rates. 

The Federal Reserve which is the United States central bank, will release there latest interest rate decision Wednesday evening. Speculators are predicting that the FED will raise interest rates from 1.25% to 1.5% which will match the Australian interest rate. Regular readers will be aware that there is a direct correlation between the commodity currencies and the US dollar. As the US dollar is a safe haven and the commodity in some ways is a risk, I expect to see the Australian dollar sold off and the US dollar to be purchased.

The EU summit on the 14th and 15th December, should outline more detail about the Brexit negotiations. UK Prime Minister Theresa May has announced in recent weeks that Brexit negotiations are going well and therefore the UK and EU have agreed to start stage 2 negotiations. If the EU reiterate Theresa May I expect this could provide a further boost for sterling.

Therefore it looks like the Australian dollar could devalue Wednesday evening and the pound could have a finish to the week, therefore my forecast is for GBPAUD to break 1.80 by the close of play on Friday. If you have Australian dollars to sell and need to buy sterling I would recommend getting in touch as soon as possible.

If you are buying or selling Australian dollars in the upcoming weeks, months or years feel free to email me with the reason for your conversion (company invoice, buying a property) and the timescales you are working to and I will email you with my forecast and the process of using our company drl@currencies.co.uk.

** If you are already using a brokerage and would like to know if you are receiving the best rates possible email me with the exact figures and I will reply with our live price. This will take you minutes and in the past I have saved clients thousands! **

How long will this period of Australian dollar strength against sterling?

My recent article this weekend suggested that there was a possibility that GBPAUD could reach 1.80 in the upcoming weeks and until late yesterday afternoon this prediction looked very likely. However the DUP at the close of business yesterday evening announced they are unhappy that UK Prime Minister could offer a different border control for Northern Ireland compared to the rest of the UK. Off the back of the news the pound lost ground against all of the G10 currencies and the Australian dollar.

Later that evening, the Reserve Bank of Australia held interest rates at 1.5%, which was no surprise, however surprisingly the Reserve Bank of Australia’s commentary was extremely positive which strengthened the Australian dollar further against the pound. With the amount of strength we have seen for the Aussie rumors the Reserve Bank of Australia may appear to be backtracking and actually could raise interest rates early next year. If this is the case, it’s quite clear that the RBA have been jawboning in an attempt

However, I’m still of the opinion that the UK will secure some kind of deal in the upcoming weeks with the EU which will mean trade negotiations will begin in the New Year. If this is the case this period of strength for the Australian dollar against sterling could be short lived therefore I would recommend any client converting Australian dollars into sterling should look to make arrangements sooner rather than later.

If you are converting pounds into Australian dollars as you are emigrating or if you are leaving Australia to move to the UK and need to buy pounds in the upcoming weeks, months or years feel free to email me with the the timescales you are working to and I will email you with my forecast and the process of using our company drl@currencies.co.uk.

** If you are already using a brokerage and would like to know if you are receiving the best rates possible email me with the exact figures and I will reply with our live price. This will take you minutes and in the past I have saved clients thousands! **

Could GBPAUD break through 1.80 this week? (Dayle Littlejohn)

This week GBPAUD hit a 1 year high. Over the last three months the pound has been making considerable inroads against the Australian dollar. Exchange rates have increased from 1.62 to 1.77 and therefore a £200,000 currency transfer today compared to three months ago will generate our clients an additional AU$30,000.

The pound made further inroads against the Aussie last week when UK Prime Minister Theresa May announced that the UK are willing to pay €50bn to the EU as a divorce settlement and the EU appeared to be happy with the offer.

The UK Prime Minister Theresa May is set to meet President of the European Commision Jean Claude Juncker and President of the European Council Donald Tusk tomorrow to discuss Brexit further. The divorce settlement bill will be discussed further but a hot topic will be the Irish border.

This weekend in particular, The Republic of Ireland have stated a hard border splitting the Republic of Ireland and Northern Island is not an option and Donald Tusk has announced he would back Ireland over the UK as Ireland will remain a member of the EU.

Reports are suggesting that Theresa May’s teem believe it’s impossible to put a deal on the table for Ireland until the UK know the deal they will receive with the EU in regards to trade. Further reports Rumours suggest Mr Tusk actually agrees with Theresa May therefore I expect this topic will be put on hold on to trade discussions have begun. Therefore I expect the pound to continue to rise against that Australian dollar this week and in fact 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.

Pound spikes to a 1-year high after Brexit Bill breakthrough! (Joseph Wright)

The Pound has spiked in the early hours of this morning, hitting a new 1-year high against the Aussie Dollar as the Pound gains across the board of major currency pairs.

The reason for the spike is due to the much speculated Brexit Bill figure apparently being agreed between UK and European counterparts, with the figure reportedly being around £50bn. The cost is to cover accrued European debts and liabilities over the past 44 years of EU membership, and despite being such a high figure the market reaction has been a boost to Sterling’s value.

The market belief is that this Brexit Bill agreement is now likely to pave the way for trade negotiations to begin between the UK and the EU, therefore reducing the likelihood of a disorderly Brexit or Hard Brexit as many have labelled it.

With regards to the GBP to AUD rate, I would now expect to see the rate hit 1.80 as opposed to 1.70 next as should Brexit negotiations progress I expect to see the Pound continue to climb as confidence returns to the markets.

Economic data out of the UK is quiet for the remainder of the week, which means the GBP/AUD pair may continue to be driven by sentiment which favours the Pound after this latest Brexit update.

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.

 

Australian wage growth disapoints

In the early hours of the morning Australia released their latest wage growth numbers for the last quarter, and the Australian dollar lost value as the numbers disappointed.  This release has the potential to now influence the next round of inflation and consumer spending which again could cause problems for clients holding onto Australian dollars.

The US have also released important data today in the form of Consumer Price index also known as inflation. The inflation numbers rose to 1.8% from 1.7% and I believe this is the last nail in the coffin and the Federal Reserve will hike interest rates on December 13th.

In recent years currency speculators appear to bounce between the Australian dollar and US dollar, as the Australian dollar returns high interest on investments and the US dollar is a safe haven currency.  If the Federal Reserve raise interest rates US and Australian interest rates will both be 1.5% and I therefore expect to see a major sell off of Australian dollars to buy US dollars.

Therefore clients buying the Australian dollars may receive improved rates in the months to come, where as Australian dollar sellers may wish to buy their currency sooner rather than later. 

If you need to buy or sell Australian dollars and would like to save as much money as possible, feel free to email me with your requirements and I will respond with the process of using our company drl@currencies.co.uk. As a company we pride ourselves in the ability to get you a better exchange rate than your current currency provider or your bank. In addition we can outline your options and the potential future events, which will impact your exchange rate. This will help you to make informed and educated decisions.

 

UK economy growth is picking up, will GBP/AUD reach 1.75 again in the near-term future?

The Pound has picked up once again this afternoon after some better than expected economic data, this time in the form of GDP figures has boosted the markets.

This means that UK economic output in the months of July-September grew by 0.4% whereas it’s grown by 0.5% from August-October. This is of course positive news for the Pound and the Pound is now trading around the 1.7250 mark at the time of writing.

The highest the GBP/AUD rate has traded in the last year is 1.7650 so the rate is now within 4 cents of the best levels so it appears that the rate hike last week from the Bank of England has boosted sentiment surrounding the UK economy.

The think-tank that produced today’s GDP figures also believes that the Bank of England will have raised interest rates to 2% by 2021 which is a bit more bullish than the comments outlined by the BoE last week when rates were hiked, and I think that the Pound would climb quite considerably from its current levels should such a bullish monetary policy be adopted by the BoE.

The next busy day for economic data is Tuesday next week, so feel free to get in touch in the meantime if you would like to plan around this event, should you have any upcoming currency requirements.

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.

Iron prices continue to put pressure on the Australian dollar

GBPAUD exchange rates have increased in value by 8 cents since September as the Australian dollar has been under pressure and sterling has rallied off the back of an interest rate hike and Brexit developments. To put this into monetary value a £200,000 conversion into Australian dollars now generates our clients an additional 16,000 Australian dollars.

The Australian economy relies heavily on iron ore, as iron ore makes up 16.3% of Australian exports. When iron ore prices fall this tends to have a direct impact on Australian dollar exchange rates. China is Australia main trading partner and as construction activity has been slowing in the 2nd largest economy the need for the commodity iron ore falls. Forecasters are suggesting that in the upcoming months iron ore prices will continue to fall and the price per tonne could plummet to $50.

The Australian dollar has also lost value in recent weeks as the Reserve Bank of Australia continue to give a dovish outlook in regards to interest rates. Governor Philip Lowe has insisted that monetary policy will not be changed in the foreseeable future and this was supported by the poor inflation numbers last month.

A data release to keep a close eye on for the remainder of the year is the US interest rate hike in December. If the US hike interest rates (87% chance according to forecasters) I expect a major sell off of Australian dollars which would make the Aussie cheaper to buy.

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.

RBA Interest rate decison (Daniel Johnson)

RBA keep Rates on hold

During the night we saw the Reserve Bank of Australia (RBA) interest rate decision. Rates were kept on hold at 1.5%, this was anticipated so id did not have a significant impact on Australian dollar value. The market moves on rumor as well as fact, volatility is created when things don’t go according to the general consensus.

Interest Rate Forecast

I would expect interest rates to remain at these levels for the foreseeable future due to the situation with the Australian housing market and Chinese growth. Housing prices in Melbourne and Sydney are well above the national average due to the higher wages being offered in the cities. This is all very well, but when you have foreign investors buying the properties unconcerned with the inflated process we are starting to see a housing bubble start to emerge. A very similar situation to London, a bubble that can not afford to burst.

There is also Australia’s heavy dependence on the Chinese to purchase their raw materials. Iron ore is Australia’s primary export and as such it’s price can influence Australian Dollar value. Despite Chinese growth still being healthy it is by no means as strong as previous years which is worrying considering Australian’s heavy reliance on the Chinese. It is wise to keep an eye on both Chinese growth data and Iron ore prices if you are considering trading Aussie.

During such unpredictable times you need an experienced broker on board if you wish to maximise your return. If you have a pending currency transfer let me know the details of your trade I will endeavor to assist. There is no obligation to trade by asking for my help, I will provide a free trading strategy to suit your individual needs. If you do wish to try our service you can trade in the knowledge we are a no risk entity, as we do not speculate. Foreign Currency Direct PLC has been in business for over 16yrs and we are registered with the FCA. If you already use a provider I can perform a comparison within minutes and I am confident I will demonstrate a considerable saving. I can be contacted at dcj@currencies.co.uk 

Sterling to Aussie Dollar rate plunges after BoE rate hike, what happened? (Joseph Wright)

This afternoon at lunchtime the Bank of England hiked interest rates by the expected 0.25 basis points, although in the immediate aftermath the Pound fell dramatically against every major currency pair.

At the time of writing the Pound to Aussie rate has fallen by 2% with the GBPAUD rate now sitting at 1.6917 and the AUDGBP rate sitting at 0.5910.

This afternoons move has come as a surprise to the markets, as usually when the base rate increases the underlying currency climbs. The opposite has happened today though as it appears that prior to the move by the Bank of England the hike was priced into the market, and the commentary afterwards was a bit more bearish than the Sterling bulls had hoped for.

It’s looking like there won’t be a particularly aggressive approach from the Bank of England regarding monetary policy moving forward, which is why we’ve seen the Pound lose so much value in such a short space of time.

There won’t be any further major economic announcements out of the UK tomorrow that are likely to move markets to such a great extent, although Australian Retail Sales data is coming out in the early hours of this morning which may impact the rates.

If you wish to be kept updated regarding any other short-term price movements between the pair, do feel free to register your interest with me. Moves such as today’s can result in large differences in a currency transfer outcome so being aware of these moves can be highly beneficial.

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.

 

 

Should I trade my Australian dollars into sterling now? (Dayle Littlejohn)

For people that are emigrating to the UK at some stage you will need to convert Australian dollars into Sterling and thats where I come in. The currency company that I work for undercuts banks exchange rates which means you will have more sterling for when you arrive on UK shores.

Since the Brexit vote rates for selling Australian dollars to buy sterling have been fantastic however in recent weeks the pound has been recovering against the Australian dollar due to the devaluation of the Australian dollar and the strengthening of sterling.

Australian inflation fell last week, which confirms the Reserve Bank of Australia’s commentary that an interest rate is completely off the cards. UK inflation has been on the rise for many months due to the weaker pound and it’s likely that the Bank of England will raise interest rates this Thursday which means GBPAUD could push towards the mid 1.70s.

The key economic event that will continue to drive GBPAUD exchange rates is the Brexit negotiations. The UK and EU negotiators have made it clear that decisions need to be made in the upcoming months, and UK Prime Minster Theresa May confirmed last week that both parties are close to securing the EU citizens rights deal. This is so important for sterling exchange rates as a deal will mean stage 2 negotiations can begin.

For people that need to convert Australian dollars into pounds, you are still receiving something I call ‘the Brexit discount’. In the upcoming months I expect the pound to continue making inroads against the Australian dollar therefore converting sooner rather than later would be my strategy.

If you are buying or selling Australian dollar in the upcoming weeks, months or years feel free to email me with the reason for your conversion (company invoice, buying a property) and the timescales you are working to and I will email you with my forecast and the process of using our company drl@currencies.co.uk.

** If you are already using a brokerage and would like to know if you are receiving the best rates possible email me with the exact figures and I will reply with our live price. This will take you minutes and in the past I have saved clients thousands! **