Tag Archives: australian dollar

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.

Busy day for GBP/AUD exchange rate, can we expect to see similar volatility moving forward? (Joseph Wright)

The Pound has been trading in a volatile fashion today as a number of headlines have resulted in Sterling movement.

Although there is no major data set for release out of the UK this week, and there was little released today by the way, I wouldn’t be surprised to see the Pound move further as Brexit talks appear to be heating up.

This afternoon we saw the Pound sold off as it appeared that Brexit Secretary David Davis has a different opinion to his European counterparts regarding how Brexit negotiations are going. The International Monetary Fund’s Managing Director, Christine Lagarde today also threw her hat into the mix and stated that there needs to be more clarity regarding the Brexit, and that a ‘No Deal’ Brexit is unimaginable.

The downward trend has since reversed for the Pound as in the last 30 minutes or so its been reported that Michel Barnier, the European Chief Negotiator for Brexit has stated that the EU could offer the UK a 2-year transition stay in the EU market after Brexit.

In a market like this its very difficult to judge which way the market will move, but working on a trading floor means that we’re able to react quickly to the sudden moves.

Today’s price movement has been over 1.25% which on large currency transfers can equate to a substantial amount of money, which is where timing your transfers can really make the difference.

There are no major announcements out of Australia either this week, so I expect the pair to continue to be driven by sentiment with today’s trading session being a clear example of how comments from significant personnel can move the markets.

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.

Will GBPAUD rise or fall in October?

The pound to Australian dollar rate is looking more and more fragile in recent weeks yet has remained in the higher 1.60’s and even over 1.70 since the beginning of September. With wage growth a concern and consumer confidence starting to slip there is a growing concern there will not be any interest rate hikes for some time down under. This has seen the Australian dollar weaker as investor debate the next move from the RBA, further weakness on the Australian dollar would not be too surprising at all.

Buying Australian dollars with pounds has become much less costly in the last month as the pound surged on an expectation the Bank of England might raise interest rates next month. Coupled with mounting concerns over the dates for any possible Australian interest rate hikes GBPAUD climbed to some of the best rates since June.

Despite the inherent uncertainty over Brexit the pound is much better supported on renewed belief the UK Government under Theresa May will deliver Brexit. With a transitional period being discussed to extend the time frame for when the UK legally leaves the EU, there is now scope for the pound to find more support.

Whilst uncertainty over Brexit and a renewed confidence in the Aussie could see us shift lower in the the mid 1.60’s or even lower, for now the outlook seems to favour GBPAUD in a range of 1.68-1.73, I see it finding supporting above 1.70 in the next few weeks.

If you have a transfer to make buying or selling Australian dollar making plans around these key events is vital to getting the best deals. If you wish to discuss your transfer in more detail please speak to me Jonathan Watson by emailing jmw@currencies.co.uk

Bad news for the Pound pushes it lower, are trade levels in the early 1.60’s on the horizon again? (Joseph Wright)

Despite some negative data being released down under in the early hours this morning, the Pound has still dropped against AUD throughout the day’s trading.

The worst Retail Sales figures in 4 and a half years were published this morning, as it turns out that Australian consumers are beginning to cut back on items such as food, clothing and furniture.

The reading for July was also revised down from the previous reading, meaning that the two drops in sales figures are the biggest back to back drop since 2010.

Despite this this disappointing data release the Pound has still fallen against the Aussie Dollar, whereas the majority of other major currency pairs have risen against the Aussie.

Sentiment surrounding the Pound took a knock today as ratings agency, Standard & Poors questioned whether the UK could withstand an interest rate rise, and it emerged that car sales in the UK are continuing to drop.

There has also been a lot of talk regarding UK Prime Minister, Theresa May’s calamitous speech to the Conservative party conference on Wednesday.

Odd’s are increasing on her resignation and although I don’t expect any changes at number 10, I think any talk surrounding this matter could result in a weaker Pound which could push the GBP/AUD pair down towards the 1.60 mark.

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.

GBP AUD Under Pressure as Brexit Tensions Escalate Further (James Lovick)

The Reserve Bank of Australia (RBA) held interest rates last night as widely expected at 1.5%. The general feeling is that rates will not change until 2018 at the earliest but is important to highlight that there is a growing concern over the strength of the Australian dollar. A strong dollar is bad for Australia’s exports and the RBA has been known to jawbone the currency by making statements surrounding monetary policy that have the effect of moving the currency without the central bank actually having to take specific action. Looking forward we are likely to see such arm twisting from the RBA and the Australian dollar could see some weakness in the coming months.

GBP AUD exchange rates could also see a sizeable boost if Britain and the EU can get to a point of “sufficient progress” with the EU. As things stand the pound remains in a very weak position with all the uncertainty that surrounds Brexit. Any signs that there will be a future trading agreement should see the pound make considerable gains although we are not at this stage yet.

This week Jean Claude Juncker and Michel Barnier have both highlighted that more needs to be done. Expect more mileage from Brexit and there could be some good opportunities in the coming weeks for buyers and sellers alike. Clients looking to sell Australian dollars could see a small window of opportunity if tensions rise.

Australian retail sales numbers and trade balance data are released on Thursday and could create some volatility for the Aussie dollar. Data on Thursday focussing on the construction sector will also be keenly viewed as it may give some clues as to where the sector is heading. There have been ongoing concerns over Australia’s buoyant property market and it is expected to only be a matter of time before a wobble is seen at the top.

It is traditionally the construction and housing markets which are the first to fall ahead of a downturn. Whilst we may not be there yet any signs of a slowdown starting to happen down under could see the dollar weaken.

If you would like further information on sterling or 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 GBPAUD continue to rise this month?

The pound made considerable gains against the Australian dollar throughout September due to the Bank of England’s stance surrounding future interest rates and the dovish stance from the Reserve Bank of Australia.

Governor of the Bank of England Mark Carney announced that an interest rate hike could occur as early as November and currency speculators have purchased the pound in anticipation.

Governor of the Reserve Bank of Australian Philip Lowe confirmed that an interest rate hike anytime soon is unlikely as they do not want to see household debt rise further.

In other news iron ore prices in Austrian have been taking a tumble in recent weeks. Iron ore is Australia’s largest export and when iron ore prices fall this tends to mean the Austrian dollar follows suit. If iron ore continues to decline I expect buying Austrian dollars will become cheaper in the upcoming weeks.

Another factor that will have a major impact on GBPAUD exchange rates is Brexit developments. Currently Brexit negotiations have stalled once again as UK and EU negotiations cannot come to an agreement in regard to the divorce settlement or EU citizens rights once the UK depart the EU. This could be a story that has a positive or negative impact on the pound.

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! **

Is the Aussie Dollars bullish run coming to an end? (Joseph Wright)

The Pound is continuing its recovery against the Aussie Dollar, with the rate rising above the 1.70 mark once again and this time almost hitting 1.72 at its highest point during today’s trading session.

I believe this change in direction for the pair can be put down to both Sterling strength as the pound is also putting in some strong performance against other major currency pairs. This is likely due to Brexit headlines and uncertainties not being in the spotlight which has been a welcome change for those hoping to exchange their Pounds at more competitive levels.

The upward movement for GBP/AUD has also been aided by the weakening Aussie Dollar which had previously been one of the strongest performers of the year.

The drop in the Aussie dollars value can be put down to a slowdown in Chinese growth, falling commodity prices such a iron ore which is key for AUD, and also talk of the Reserve Bank of Australia not planning on hiking interest rates until 2019 which is in start contrast to the Bank of England who have alluded to hike as soon as next month.

Tomorrow morning there will be a key data release out of the UK as UK GDP will be released around 9.30am. If this figure deviates from the expectation we could see further movement, so feel free to get in touch with me if you wish to be kept updated regarding this release.

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.

A dramatic fall for the Australian dollar

Towards the end of last week the Australian dollar lost value against all of the major currencies due to RBA governor Philip Lowe announcing that it was unlikely the RBA would raise interest rates anytime soon.

Within my last article I suggested this would be the case, as the Governor in recent months has made it clear if the Australian dollar continues to strengthen in value, this could have a negative impact on GDP and the amount of jobs that are created.

The Australian dollar also took a tumble due to a further fall in the commodity iron ore. Iron ore is Australia’s largest goods export and over the last six trading sessions is down 13.7%. There is a direct correlation with iron ore and Australian dollar exchange rates. When iron falls exchange rates fall when iron rises exchange rates rise.

However the Australian dollar didn’t devalue much against sterling this week as Theresa May’s lack lustre speech in Florence Friday left the currency markets wanting more and therefore a sell off of sterling occurred. The PM gave no indication to how much the UK would pay the EU when the UK departs and this is what the market was anticipating.

It’s a quiet week for Australian economic data releases, the only release to look out for is Private sector credit Friday morning however this isn’t normally a big market mover. For people that are buying or selling Australian dollars this week should also analyse the other currency that you are converting.

If you are making a currency conversion in the upcoming weeks or months, I would recommend emailing me with the currency pair you are converting (AUDUSD, AUDEUR, AUDGBP) the reason for your transfer (business transaction, property purchase) and the timescales you are working to and I will respond to your email with my forecast and the process of using our company drl@currencies.co.uk.

Enjoy the rest of your weekend and I look forward to speaking with you Monday morning.

Dayle Littlejohn

 

 

Will Theresa May strengthen the pound against the Australian dollar?

This Friday UK Prime Minister Theresa May is set to deliver a life after Brexit speech and economists are predicting a volatile day for sterling vs Australian dollar exchange rates. An EU official has stated that she has an important intervention to make however has made no further comment.

Rumours are suggesting that the Prime Minister may back track from comments made by her fellow peers within the Conservative party and actually state the UK will be paying the EU an amount of euros to depart. If this is the case I expect the pound to rally against the Australian dollar as the UK are one step closer to negotiating a trade deal with the bloc.

However if the rumours are not true and she exclaims that the UK and EU are struggling to come to an agreement then this could lead to a major sell off of sterling and the recent gains for Australian dollar buyers could diminish. Personally if I were buying Australian dollars if we see a shift above 1.70 I would seriously be tempted to take advantage before the pound finds itself under pressure again when Brexit negotiations begin towards the end of the month.

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.

** IF YOU ARE ALREADY USING A BROKERAGE TO BUY YOUR CURRENCY IT WILL TAKE TWO MINUTES TO EMAIL FOR A COMPARISON AND I AM CONFIDENT I WILL BEAT ANY PRICE YOU ARE CURRENTLY RECEIVING  **

GBPAUD reaches 8 week high

The pound has been on the charge of late and GBPAUD exchange rates have reached an 8 week high!

This week UK inflation numbers rose to 2.9% which promoted the Bank of England to release a hawkish statement after the interest rate decision.  Members of the monetary policy committee hinted that an interest rate hike could occur in the upcoming months if inflation continues to rise.

Personally I believe the Bank of England have artifically strengthen sterling in a bid to curb the worrying inflation levels and an interest rate hike this year is extremely unlikely. Nevertheless the Bank of England have provided a window of opportunity for Australian dollar buyers.

This week the Reserve Bank of Australia are set to release their latest minutes Tuesday morning. I don’t expect the minutes to provide any further insight to interest rate decision moving forward as the Governor will not want the Australian dollar strengthening any further in the upcoming months due to speculation.

Later in the week UK Prime Minister Theresa May is set to deliver a speech in Florence outlining life after Brexit. EU Parliament negotiator Guy Verhofstadt has exclaimed the UK Prime Minister will make an “important intervention” and if this is the case GBPAUD could rise or fall dramatically. The problem clients have that are converting GBPAUD is trying to predict Theresa May is impossible.

If you are trading GBPAUD in the upcoming weeks, months or years and want to save money, 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! **