Tag Archives: australian dollar

Could the Pound improve against the Australian Dollar this month and possible reasons why? (Tom Holian)

The Pound has been steadily increasing against the Australian Dollar since the turn of the year and although we have seen some small losses for the Pound, generally speaking the market for anyone looking to buy Australian Dollars has been very positive.

With the US threatening to continue raising interest rates the next interest rate hike by the Fed is likely to come in March and this is in part why we have seen the Australian Dollar struggle against the Pound.

On Tuesday the latest set of minutes are due to be released by the Reserve Bank of Australia and I think this could provide the catalyst for Sterling strength against the Australian Dollar as I think the RBA will be relatively cautious in their tone.

If you look at the markets through the eyes of a global investors if you have available funds it is likely that you would look to invest in the US as with interest rates planned to be going up as well as strong growth in the world’s leading economy this could potentially be a good investment.

This could result in a sell off for riskier based currencies such as the AUD and this is why I think in the longer term that we’ll see GBPAUD exchange rates challenge 1.80 before the end of this month.

On Tuesday the UK releases the latest Quarterly Inflation Report Hearings and as inflation has continued to remain higher than the target I think this will put pressure on the Bank of England to look at raising interest rates possibly as early as May.

On Wednesday the latest UK unemployment data is due to be published and although this has been very strong one of the concerns is Average Earnings which have been lagging behind inflation so this could see a bit of volatility for GBPAUD exchange rates in the middle of the week.

If you would like to free quote when buying or selling Australian Dollars and would like to save money on exchange rates compared to using your own bank then contact me directly. Having worked in the foreign exchange industry for one of the UK’s leading currency brokers since 2003 I am confident of being able to save you money and help you with the timing of your transfer.

Feel free to email me directly with a brief description of your requirement and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

 

RBA Interest Rate Forecast vital to AUD value (Daniel Johnson)

NAB predict Rate Hike as early as August

The National Australia Bank (NAB) has a very optimistic forecast in regards to rate hikes by the Reserve Bank of Australia (RBA). They are a minority. They are of the opinion we could see an interest rate hike by 0.25 basus points as early as August.

“The RBA has indicated that it is in no rush to raise rates in lock-step with global central bank counterparts. However, lower unemployment, and evidence of wages growth moving upwards — even gradually — should be enough to give the RBA confidence that inflation will eventually lift above the bottom of the band,” said Alan Oster, NAB Chief Economist.

“We continue to forecast two 25 basis point rate hikes in August and November, although acknowledge the risks are that these hikes could be delayed.”
Oster attached a couple of warnings which could change the RBA’s decision, noting that a slowing in household credit and house prices due to macro-prudential measures implemented by APRA “may help alleviate some concerns about household debt”.He continued “higher AUD may also threaten this outlook although our revised forecasts are for the currency to be 75 US cents by year end”.

Personally I do not share his view. I think a hike by August is very optimistic and economic data is not consistent enough to warrant a hike . Inflation is some way from where it needs to be and there is no reason to suggest there will be a rapid rise between now and August. This a viewpoint shared by the man that counts. RBA Governor, Philip Lowe who recently stated the following.

“further progress in reducing unemployment and having inflation return to the midpoint of the target range”, adding that it was “likely that the next move in interest rates in Australia will be up, not down”.

He also said “while we do expect steady progress, that progress is likely to be only gradual.

The general consensus is there will not be a rate hike until at least early 2019.

If you have a currency requirement I would be happy to assist. If you wish to maximise your return it is important to be in touch with an experienced broker. If you let me know the details of your trade I will endeavour to produce a trading strategy to suit your needs. If you have a currency provider in place I am willing to perform a live comparison and I am confident I will be able to demonstrate a considerable saving. It will only take a couple of minuites and could be well worth your while.

You can trade in safety knowing your trading with Foreign Currency Direct PLC, a company trading for over 16 years. Our accounts are published online at companies house and we are FCA registered.

If you would like my help I can be contacted at dcj@currencies.co.uk. I look forward to hearing from you.

Will GBPAUD hit 1.80 in February?

The pound has risen against the Aussie to post-Referendum highs recently nudging the 1.80 mark which is presenting some very favourable opportunities for Australian dollar buyers who have so far been suffering since the EU vote. Here at the blog we try and keep clients up to date with the latest news and trends in the market that could influence your decisions on when to buy or sell currency.

The key news driving the GBPAUD this week has been events in the United States with the movement on the stock market and the US dollar triggering some big swings on USD/AUD, which in turn has seen some big movements on GBPAUD. As the Australian dollar lost ground to the US dollar which strengthened following uncertainty over the stock market, the Aussie was weakened against the pound. This is what saw GBPAUD hit the highs of last week.

Flip this all around the soothe of the those stock market fears this week has seen the US dollar lose value as investors have confidence to reinvest in more profitable shores elsewhere like stocks. This has seen the Aussie gain back some ground against the pound. Other factors on the GBPAUD pairing include the Australian Unemployment data released overnight, whilst this didn’t directly see movement on the Aussie it is important.

In underlining the strength of the Australian labour market it leaves the door open to further rate hikes this year but generally the market does not appear likely to want to factor in any hikes. Raising interest rates in Australia almost appears to be necessary in some respects but could prove very damaging.

What we may see is markets gently realising any hikes are unlikely and this could weaken the Aussie. Couple this with some strength fort he pound and GBPAUD could easily test that 1.80 level. If you are looking to make any transfer at 1.80 please speak to us about all of your options and the best way forward to maximise and capitalise on any position you will need to consider.

To learn more please contact myself Jonathan Watson on jmw@currencies.co.uk and I can outline our service and a strategy to suit your situation.

Australian Dollar Holds Steady after Unemployment Data (James Lovick)

The Australian dollar is still seeing an uncertain period with so many factors globally influencing the exchange rate. Overnight has seen unemployment data released which has held firm at 5.5% as expected. The Reserve bank of Australia are paying close attention to the labour market at the moment and are keeping a very close eye on the amount of wage growth down under, something all the central banks are monitoring closely. When wage growth begins to rise it will be a reason for the RBA to raise interest rates although for the moment the figures are still sufficiently weak to make the case for no changes to interest rates.

The RBA minutes from the last meeting will be released next week and will reveal what the central banks thinking from the last meeting. Any suggestion that the RBA will look to raise rates this year and follow in the US Fed’s footsteps could see the Aussie gain although it is my understanding that they are more likely to monitor the situation in light of all the recent volatility in the financial markets. Those clients looking to sell Australian dollars hoping for a move back to 1.70 might have a good while longer to wait.

Clients looking to buy Australian dollars are seeing a good opportunity to buy although the recent rally in the price of sterling has slowed down in the last week with rates coming off the recent highs. The pound is likely to see a lot of volatility in the coming weeks coming from the political arena. There are a series of speeches to be made by British politicians within the British government which should offer more clues as to where Brexit will end up.

UK Prime Minister Theresa May will be in Germany tomorrow and she is likely to make a statement either on Friday or Saturday. If we go back to the Lancaster House speech back in 2017 the pound rallied by almost 2% following the speech and so it should not be underestimated how much the sterling markets could move if more detail over Brexit is offered.

To discuss your requirement and how these events are likely to impact on your own requirement then please get in touch with me at jll@currencies.co.uk

Inflation to influence GBPAUD exchange rates

Tomorrow morning the UK will release their latest inflation numbers and a slight fall is to be expected. Normally a slight fall would lead to a weakening pound however I expect a fall in inflation could strengthen the pounds position against the Australian dollar. My reasoning is that the Bank of England last week announced they expect inflation to fall and wage growth to rise, which will lead to an interest rate hike. The release is at 9.30am for further information in regards to the inflation release feel free to email me on drl@currencies.co.uk.

Later in the week (Wednesday) Boris Johnson is set to address the public in regards to Brexit. The aim of the speech is to unite remain and leave voters. Past history leads me to think that Mr Johnson may go off topic, especially if he is asked about Michel Barnier’s comments last week. For clients buying Australian dollars with pounds, I would be tempted to take advantage after the inflation numbers and not wait for Mr Johnson’s speech.

Economic data releases are thin for Australia until Thursday at 1.30am in the morning. Unemployment and employment change numbers are to be released. Unemployment numbers are set to fall to 5.3%, which is fantastic for the Australian economy. Employment change numbers are set to show a slight decline however I expect the Unemployment numbers to outweigh the employment change numbers, therefore I expect a positive morning for the Australian dollar.

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.

BOE comments causes Sterling Spike (Daniel Johnson)

GBP/AUD – In Depth

Sterling has struggled against the Aussie following the decision to hold a referendum to leave the EU. GBP/AUD sat above 2.20 pre referendum and of late has been mired in the 1.70s. We have seen a recent spike for Sterling which can be atributed to several contributing factors.

Although there was a recent surge in retail sales figures from down under the spike for the Australain Dollar did not last long, as predicted it was an an anomamly that could be put down to Black Friday sales and the release of the iphone X.

Since then the Reserve Bank of Australia (RBA) have indicated that they will keep interest rates on hold for the considerable future the Aussie has lost value. This can be justified due to the infalted property prices in high wage growth areas. Foreign investors are willing  to pay these prices as investments but it is causing the locals to struggle spending the majority of their funds on neccesities rather than luxury goods. This does not bode well for the Aussie.

The recent surge to 1.79 was caused by hints from the Bank of England (BOE) there could be a rate hike as early as May 2018. The market moves on rumour as well as fact and investors bit.

It is important not to have too high expectations if you are an AUD buyer however, the uncertainty surrounding phase two of Brexit talks has the potential to hurt the pound. Davis and Barnier are far from being on the same hymn sheet.

If you have a currency requirement I would be happy to assist. If you wish to maximise your return it is important to be in touch with an experienced broker. If you let me know the details of your trade I will endeavour to produce a trading strategy to suit your needs. If you have a currency provider in place I am willing to perform a live comparison and I am confident I will be able to demonstrate a considerable saving. It will only take a couple of minuites and could be well worth your while.

You can trade in safety knowing your trading with Foreign Currency Direct PLC, a company trading for over 16 years. Our accounts are published online at companies house and we are FCA registered.If you would like my help I can be contacted at dcj@currencies.co.uk. I look forward to hearing from you.

 

 

Where Next for the Australian Dollar – Stock Market Crash Impact (James Lovick)

The Australian dollar has seen a very volatile week with lots of events happening globally since Monday which have had a direct and considerable impact on the strength of the Aussie. The Australian dollar has come under pressure after $66 billion was wiped off Australian shares earlier in the week following a global sell off with considerable losses also seen in the US and UK stock markets.

The Australian dollar which is regarded as a commodity currency normally comes under pressure in times of global uncertainty and this happening again now. This new wave of uncertainty in the global economy could see further problems for the Australian dollar and the Aussie may have further to fall.

However the Reserve Bank of Australia may intervene before that happens and any signal from the central bank that it is keen to raise interest rates later this year could see the dollar bounce back. Clients looking to buy Australian dollars are seeing some excellent buying prices which have stemmed from the perceived extra global risk and there may be some more gains to be had in this rally. Any further shocks from the US are likely to result in further weakness for the Aussie.

GBP AUD

Rates for GBP AUD have seen a good week with levels for this pair now sitting at around 1.77. The Bank of England meet tomorrow to discuss interest rates and any change in policy could see movement for sterling exchange rates. The Bank of England Governor however is more likely to cause a market reaction on the back on any commentary on Brexit. The central bank is unlikely to make any changes to interest rates although any suggestion that there is likely to be a rate increase later this year should help support the pound.

Clients looking to buy or sell Australian dollars would be wise to get in touch to take advantage of any spikes in the market which si something we can help you with. Please feel free to get in touch with me at jll@currencies.co.uk

FED interest rate decision to impact Australian dollar exchange rates

This evening the Federal Reserve (United States Central Bank) will release their latest interest rate decision and for the last time Chairlady of the FED Janet Yellen will give her last press conference as Chair. For clients that are buying or selling Australian dollar it’s important to understand that decisions made in the US have a direct impact on Australian dollar exchange rates.

In recent weeks most major currencies have benefited from the demise in the US. President Donald Trump at present is trying to pull the US out of NAFTA which is the trade agreement between the US, Mexico and Canada. These negotiations are on going and could take 12 months. Nevertheless the US dollar has lost value and the Australian dollar has benefited.

The FED decision tonight could indicate whether the UK will raise interest 3 times this like predicted at the beginning of the year or if forecasts have changed. Personally I expect this release to weaken the US dollar further which could benefit most G10 currencies. Later in the week Non farm payroll numbers, which is the amount of jobs created in the US will be released at 1.30pm and this release could also have an impact on exchange rates.

The next key data release to look out for in regards to the Australian economy is the interest rate decision on the 6th. Inflation numbers showed a slight improvement in January, however the Reserve Bank of Australia are unlikely to hint towards any rate hike anytime sooner. Therefore I don’t expect this event to help provide strength for the Australian dollar.

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! **

 

 

GBP AUD Hits Resistance at 1.75 (James Lovick)

The Australian dollar remains set for an uncertain and volatile 2018 which will be heavily dependent on interest rate policy from the Reserve Bank of Australia (RBA) and also the US Federal Reserve. For the moment the Australian dollar has been boosted on the back of a weaker US dollar with political uncertainty and the recent government shutdown. The underlying question is how keen the RBA will be to raise interest rates this year. If the US Fed hikes 2-3 times this year as forecast then the RBA will need to carefully decide how it follows.

As things stand there is an expectation that the RBA will seek to raise interest rates in June 2018 but if the difference in rates between the US and Australia widens too much then the Australian dollar could come under some selling pressure. For the moment the future outlook on interest rates is less clear which is likely to result in considerable volatility for the Aussie as more direction from the RBA is offered. The RBA are likely to favour a weaker currency to help its export markets so the central bank may be keen to take a more relaxed view on events in the US and not rush to tighten policy. The Aussie could see a gradual weakening as the US raise interest rates in the Spring.

The US debt ceiling is expected to be reached sometime in March 2018. This is likely to be a political animal and finding agreement to extend could prove difficult. The Aussie could see material gains around this period and so clients looking to sell Australian dollars may wish to try and find an opportunity around this period.

Australian inflation data is released tomorrow and will be keenly observed by the RBA. A higher number could help see the pound rally.

GBP AUD

Clients looking to buy Australian dollars with pounds have seen a good window of opportunity in the last week although the pound is struggling to climb much higher having broken through 1.75 last week. The mood on Brexit appears to be slightly more optimistic but even now in the second round of negotiations which commenced on Monday there is still much ambiguity. Discussion currently surround the so called transitional arrangement which so far appear less thorny.

However there could be complications and disagreement when it comes to the terms of the future trade agreement between Britain and the EU. Any souring of mood could see a sharp fall in the price of sterling and I would expect to see a number of drops in sterling as a direct result of these negotiations in the coming months. Buyers should be a particularly careful as it wouldn’t take much to see a sudden drop in the price of sterling.

To discuss your requirement and how to maximise on the rates of exchange as they become available please feel free to get in touch with me James at jll@curencies.co.uk

Is now the time to sell Australian dollars and buy pounds?

In recent weeks the pound has been making gains against the Australian dollar and I expect this trend to continue in the weeks and months to come.

This weeks UK GDP and Average Earnings numbers exceeded expectation which pushed GBPAUD exchange rates back towards 1.77. Over the last 12 months the Bank of England have made it clear that they are concerned with inflation and low average earnings.

Now that average earnings have started to rise and forecasts are suggesting inflation will fall this year due to the boost in the pounds value, futures market are predicting a 50% rate hike in May and a 80% chance of a hike by November by the Bank of England, which should provide further strength for the pound.

Brexit negotiations are also going well for the UK as trade discussions begun this year and in March we will get a full update of how the trade talks are going. It feels that sentiment has also changed as European leaders continue to back the UK. Last week French President Emmanuel Macron announced the UK can have a special trade relationship with the EU and this wee German Chancellor Angela Merkel speaking at the Davos summit gave hope to UK businesses when she explained she wants to keep the UK as close to the EU as possible post Brexit.

So all in all it’s looking promising for the UK and the pound. However this doesn’t look like the case down under. Many of the leading banks including Westpac are forecasters a slow down for the Australia as interest rates will remain on hold and commodity prices will fall throughout the year.

Economic indicators are suggesting that the pound will continue to make inroads against the Austrian dollar therefore Australian dollar sellers buying sterling should look to make a transfer sooner rather than later.

If you are buying or selling Australian dollars in the upcoming months and want to achieve rates of exchange that are better than your bank, whilst receiving regular economic information feel free to email me with the currency pair (AUDGBP, AUDEUR, AUDUSD) the reason for the transfer (company invoice, property purchase) the timescales you are working to and I will respond with my forecast and the process of converting currency. My direct email address is drl@currencies.co.uk and I look forward to receiving your email.