Tag Archives: australian dollar

Could we see further falls for AUD? (Daniel Johnson)

Australian Dollar could be set further falls

I am of the opinion the Australian Dollar could be in for a rough time. Retail sales data recently fell to the worst levels in four years and this is predominantly due to the increase in property prices. High wage growth areas such as Melbourne and Sydney are becoming more and more expensive and Australians are being forced to spend their money on necessities rather than luxuries which is hitting the economy. Foreign investors are willing to pay the escalated prices which is not helping the problem.

FED Rate hike could mean trouble for AUD

There is also an anticipated rate hike by the Federal Reserve in the US.  The Australian Dollar is a favourite for investors due to the promises of high returns due to the attractive interest levels offered. The Australian interest rate is currently set at 1.5%, if the FED raises rates as predicted to 1.5% on Wednesday this would put Australia and the US on par. With the US Dollar considered to be a safe haven currency investors could well leave the Australian Dollar for the safety of the US dollar which could cause Australian Dollar weakness.

Unemployment Data and Mid-year Economic and Fiscal Outlook data could influence AUD

The Mid-Year Economic and Fiscal Outlook is published by Australian government, updates the economic and fiscal outlook from the previous budget. If there is a dovish tone the Aussie could suffer. This could well occur considering the dip in retail sales.

Unemployment data is due in Thursday and I expect there to be a drop slightly above the expectation of 5.5% which could cause Australian Dollar weakness.

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker when the market is currently so hard to predict. If you let me know the details of your trade I will endeavour to produce a free trading strategy to suit your individual needs. Have faith knowing you will be dealing with a brokerage in business for over 16yrs, Foreign Currency Direct Plc. We are a no risk entity as we do not speculate on the market and we are registered with the FCA. If you have a currency provider take a minute to send over the rates they offer and I am confident I can demonstrate a significant saving.  I can be contacted at dcj@currencies.co.uk . (Daniel Johnson) Thank you for reading.

Pound to Aussie Dollar hovers around a 18-month highs, will the Pound hold on to its recent gains? (Joseph Wright)

The Pound has managed so far to hold onto its recent gains against the Aussie Dollar, despite stalls to Brexit negotiations hitting the headlines over the past week.

There has been hopes of a agreed Brexit bill announcement this week, which would likely push the Pound higher but the there sticking point of Northern Ireland’s terms and its border is proving to be a stumbling block at the moment.

The UK’s Prime Minister, Theresa May has come under pressure for her dealings with her EU counterparts this week after many had expected to see the Brexit bill agreed, only to be disappointed to discover the Northern Irish border issue throw a spanner in the works.

Once the Brexit bill has been agreed the path is cleared for Brexit trade negotiations to begin between the UK and the remaining EU members, which I expect to be a positive for the UK and therefore the Pound. I also think that should a transitional deal be agreed we can expect to see the Pound climb also.

On a negative note for the Pound, should there be further stalls regarding any deals I think the Pound could see a sharp sell-off across the board as the UK is running out of time to make progress at the negotiating table.

If you would like to be updated in the wake of a short term price change between the Pound and the Aussie Dollar, do feel free to register your interest with me.

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 Dollar Rockets after RBA Meeting (James Lovick)

The Australian dollar has made substantial gains overnight following the meeting by the Reserve Bank of Australia last night. The central bank held rates at 1.5% as widely expected however the commentary was slightly more hawkish which has led the markets to believe that there could be an interest rate hike down under in the early part of 2018. The markets had been expecting the first hike sometime in late 2018 and so this change in expectations is helping to strengthen the Aussie.

GBP AUD – Brexit Volatility

Clients looking to buy Australian dollars with pounds have seen a good couple of weeks with some of the best levels available for a year. The more upbeat mood in Britain in terms of the Brexit negotiations has helped the pound rally over these last two weeks although GBP AUD hit a major roadblock in afternoon trading yesterday.

The expected deal between Britain and the EU which focussed on the thorny issue of the Irish border was abandoned yesterday afternoon after the Democratic Unionist Party scuppered the deal stating it was unwilling for Northern Ireland to have different terms to Britain when leaving the EU. The pound dropped against the Australian dollar immediately after the news and we may need to wait until the end of this week or next before new developments emerge.

If no deal can be hammered out then the pound is likely to drop in value quickly although the expectation is that there will be sufficient progress for Brexit talks to move onto trade before the end of next week.

Clients looking to buy or sell Australian dollars are likely to see major new direction in the rates over these next two weeks ahead of the key EU summit 14th & 15th December. Please get in touch to discuss how these event directly impact on the rates of exchange and how it affects your specific requirement. Please email me James at jll@currencies.co.uk

Factors influencing GBPAUD exchange rates

In recent weeks the pound has been making considerable gains against the Australian dollar for a few reasons. The Reserve Bank of Australia more often than not have been giving dovish statements in regards to future interest rate hikes. The Governor has said that it’s likely the next decision will be to hike however this may be at the end of 2018 or even 2019.

The US federal reserve have been hinting towards raising interest rates in December which would mean US and Australian interest rate would be the same. Speculators have and will flock to the US dollar instead of the Aussie as its seen as a safer currency and therefore less risk. Less demand for the Australian dollar means it becomes cheaper to buy.

Deadline day is getting closer for the UK Prime Minister Theresa May. The EU Commission will meet on the 14th and 15th December to discuss whether trade negotiations can begin between the UK and EU. Reports are suggesting that the divorce bill and EU citizens rights could be agreed but the sticking point could still be the Irish border.

Personally I expect the Australian dollar could have a tough end to the year and major sell offs of Australian dollars into US dollars. Couple that with positive news from the Brexit negotiations, I expect GBPAUD exchange rates could push towards the 1.80 mark.

If you are trading GBPAUD this week, month or year I would recommend emailing me with the the reason for the transfer (company goods, property purchase) and your timescales and I will response with the options available to you drl@currencies.co.uk. Alternatively if you would like to discuss your requirements over the phone call 01494-787478 and ask to be put through to Dayle Littlejohn.

** If you are already using a brokerage, I would strongly recommend you compare rates as I am confident I will be able to offer you additional savings with your transfer. All you need to do is email me with the exact figures and I will reply with our live price. This will take you a few minutes and in the past I have saved clients thousands! **

 

GBP AUD Finds Support at 1.75 (James Lovick)

GBP AUD Exchange rates are back up over 1.75 again for this pair creating a good opportunity for those clients looking to buy Australian dollars. The Aussie dollar has come under pressure of late for a number of reasons. The dovish commentary from the Reserve Bank of Australia means that although the next interest rate movement is more likely to be up rather than down the timing of a rate hike will probably not be until the end of 2018. The other factor putting pressure on the Aussie stems from what is happening in the US.

The US Fed are looking to raise interest rates in December although there have been renewed concerns over weak inflation and more importantly weak wage growth, something that has become an issue for many of the major economies. As interest rates in the US go up taking rates higher than what are currently available down under this has the effect of helping drive up the US dollar whilst weakening the Australian dollar. With the US looking to continue raising rates another 2-3 times in 2018 as things stand then the Australian dollar could find itself under considerable pressure in the New Year.

Clients looking to buy or sell Australian dollars should pay particular attention to the EU summit in the middle of December as this is where the pound should see new direction. Should the Brexit stalemate be overcome then the pound could rally materially although the risk remains of a no deal scenario.

UK banking stress test released this morning have highlighted the banks are strong enough to withstand a severe stress test scenario in a sign of strength for the banking sector. More importantly the Governor of the bank of England has said that bank will continue to support the economy in the event of a disorderly Brexit.

For more information on the Australian dollar and how these key upcoming events have a direct impact on the rates of exchange and how to maximise on the opportunities as they happen then feel free to get in touch with me James at jll@currencies.co.uk

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.

 

Will GBPAUD break through 1.75 by the end of the year? (Dayle Littlejohn)

Economic data in recent weeks has meant that GBPAUD exchange rates have increased by 8 cents and broken through the 1.70 barrier. The reason for the improvement is positive news coming from the UK in regards to Brexit and a dovish outlook from the Reserve Bank of Australia.

Brexit negotiations are heating up and decisions are close to being made. Friday evening Michel Barnier gave a two week deadline for the UK to make key decisions surrounding EU citizens’ rights, the Irish border, and the UK’s “divorce bill”.

The theory on the market is that if the UK and EU come to an agreement in the upcoming weeks and trade negotiations start before or just after the turn of the year, this could give sterling exchange rates a considerable boost.

The Reserve Bank of Australia have been given dovish statements of late and the recent RBA minutes last week confirmed that the RBA have no interest of raising interest rates anytime soon.

Couple this with Iron ore prices tumbling down under and some forecasters suggesting another substantial fall is on the horizon due to the slowdown in China’s construction industry you can understand why the Australian dollar is under pressure.

Looking further ahead if the Australian economy continues on the same path and the UK reach a deal with the EU so trade negotiations begin, I expect GBPAUD will break through 1.75.

Therefore if you are buying Australian dollars with sterling and are prepared to take the risk holding off may provide a better exchange rate in the weeks to come, however if you are selling Australian dollars to buy sterling now is the time to convert your currency.

For people that are converting pounds and Australian dollars for the first time, it is essential that you get the very best exchange rates. If you have used a brokerage for many years or have been referred a brokerage I strongly recommend you compare rates to make sure you get the best price possible and therefore save money. This simple exercise takes two minutes and in the past I have saved clients hundreds and in some instances thousands of pounds.

My direct email is drl@currencies.co.uk Dayle Littlejohn.

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.

Australian Dollar Finds Support on Stronger Commodity Prices (James Lovick)

The Australian dollar could see a renewed boost in its fortunes with the rising price of commodity prices to include oil and iron ore. Climbing commodity prices are normally a good signal that the global economy is functioning well which bodes well for currencies like the Aussie dollar. Australia of course has a large export market for raw materials and is the reason it is referred to as a commodity currency. As such when the price of iron moves higher as it has done in the last three months then this is welcome news for the Australian dollar. Any further increases in commodity currencies in these coming months should only help support the dollar further.

The Australian dollar had come into a little bit of trouble of late with some sizeable losses seen after the Reserve Bank of Australia made clear that it is not even considering any interest rate increases at this time. Rates for GBP AUD moved into much more attractive territory for those clients looking to buy Australian dollars although those gains are now being brought back down after the recent rally in commodity prices.

The pound appears to have found support above 1.70 for the moment and any changes to commodity prices are likely to see the dollar react.
For those clients buying or selling Australian dollars for sterling would be wise to pay close attention to the next round of Brexit discussion which will resume tomorrow in Brussels.

The perceived stalemate is likely to keep pressure on the price of sterling and movement round this impasse is not expected until December of even January. As such clients looking to buy Australian dollars in the short term are unlikely to see rate much higher than the levels currently available. Once again the Brexit negotiation will continue to be the single biggest driver for sterling exchange rates in these unpredictable markets.

Should you have a currency requirement and need to either buy or sell Australian dollars for pounds or Euros for example then please do get in touch with me and I will be happy to look at your requirement and see how we may be able to assist. We are able to achieve excellent commercial rates of exchange from the live markets but we can also help you with the timing of the conversion and look to help you find a good day to do the trade. You can email me directly at jll@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.