Tag Archives: australian dollar

Pound to Australian Dollar Forecast – Further interest rate cuts planned in Australia

Will Boris be the next Prime Minister?

The Tory leadership election is now down to the final two with Boris Johnson due to go head to head with Jeremy Hunt.

Johnson has been the clear leader since the votes began and the strong likelihood is that he’ll become the new Tory leader when it is officially announced on 22nd July. Johnson won the ballot with 160 votes compared to Hunt with 77. Therefore, unless Johnson makes a calamity in the next month I cannot see why he won’t win.

This has given the Pound some support against a number of different currencies but we are still in a fairly uncertain period for the Pound as we still do not what will happen with Brexit.

Australian interest rates to be cut again in 2019

In the meantime turning the focus back towards what is happening in Australia and things are not going well down under.

Following the federal election which gave the Australian Dollar a brief period of respite the currency has started to weaken again.

The Australian Dollar is close to its lowest level against the US Dollar in history and has started to weaken once again vs the Pound.

Blackrock Inc has shorted the Australian Dollar as they expect that the Reserve Bank of Australia will cut interest rates to 0.5% from the current levels of 1.25%. Australia has been one of the benefactors of having a highly competitive interest rate so with further interest rate cuts expected I think this could have a big impact on the value of the Australian Dollar.

The Australian Dollar has also felt the impact of the ongoing US-China trade wars which appear to have little signs of ending soon. As China is one of Australia’s leading trading partners any slowdown in the world’s second largest economy can often effect the value of the Australian Dollar.

RBA governor Philip Lowe has claimed that the most recent interest rate cut was an attempt to cut unemployment levels as well as helping inflation but I agree with both Blackrock and the Commonwealth Bank of Australia that there are further interest rate cuts coming during 2019.

Therefore, if you’re considering selling Australian Dollars it may be worth getting things organised in the near future.

If you would like to save money on exchange rates compared to using your own bank and would like a free quote then contact me directly and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

Reserve Bank of Australia to drive Australian exchange rates

The Australian dollar has been struggling of late and is close to the lowest levels in a decade against its US dollar counterpart. The Reserve Bank of Australia only recently cut interest rates and further cuts are on the horizon. The central bank also hinted that other stimulus measures could be used in a bid to stimulate economic growth. Furthermore, the deputy Governor Guy Debelle earlier in the year stated that quantitative easing would be a good way to stimulate the economy. History tell us that if a central bank starts a QE program it causes the currency to devalue. For clients selling Australian dollars to buy another currency, its crucial that you keep an eye and understand the RBA next move. If you would like further information on the RBA feel free to contact me on the email below.

How will the Australian dollar perform against the pound?

Even though the Australasian dollar is set for a tough 12 months, the pound has problems of its own. Brexiteer Boris Johnson is the favourite to be the next Prime Minister and its clear that he will take a different approach compared to outgoing Theresa May. A crash out no deal Brexit is looking more likely by the day and consequently the pound is losing further value. As we approach the October deadline, if a deal isn’t in place I expect GBPAUD to fall.

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.

Australian Growth data causes Investor Concern (Daniel Johnson)

Pound to Australian Dollar Forecast

The Australian Dollar has suffered of late due to several contributing factors. The most significant catalyst for the fall in Australian Dollar value is the US/China trade war. Australia is heavily reliant on China purchasing it’s goods and due to this any slow down in growth in China will have an impact on the Australian Dollar.

The Trump administration has placed significant tariffs on Chinese goods and China has retaliated with it’s own tariffs. The trade war is set to escalate and could be ongoing which does not bode well for the Aussie. Iron ore is Australia’s primary export to China and at present demand remains healthy which is good news for the Aussie, that is not to say this situation will last however.

Due to global economic uncertainty investors are choosing to shy away from riskier commodity based currencies such as AUD in favour of safe haven currencies such as the Swiss Franc and the US Dollar.

There are economic problems down under such as consumer spending and the cost of living in high wage growth areas such as Sydney and Melbourne. The Reserve Bank of Australia (RBA) took the decision to cut interest rates this month to 1.25% and there is the potential for further cuts.

The Australian economy is growing at its slowest rate in almost a decade, which has fuelled speculation surrounding how long Australia will sustain its run of over 27 years without a recession.

Despite the situation down under I believe the  problems in the UK outweigh that of those down under. We currently have no PM and are in complete Brexit limbo. If Boris gets in the probability of a no deal could increase as he will be using this scenario as a bargaining chip to get a better deal from Brussels. A no deal is the investors worst fear and has the potential to cause further woes for Sterling.

If you have a currency requirement I will be happy to assist. If you let me know the details of your trade I will endeavor to produce a free trading strategy. During a period of such uncertainty it is important to be in touch with an experienced broker if you wish to maximize your return. We have tools at our disposal to make sure you do not miss out if there is a spike in your favour.
If you already have a currency provider in place. Drop me an email with what you are being offered and I am very confident I will be able to demonstrate a significant saving. It will only take you two minutes and I am sure it will be worth your while. You can trade in safety knowing you are with a Foreign Currency Direct PLC, a firm trading for over 16yrs and FCA registered.

If you would like my help feel free to email me at dcj@currencies.co.uk.

US/China Trade Wars hurt the Australian Dollar (Daniel Johnson)

Australian Dollar hit by Trade Wars

In times of global economic uncertainty, commodity-based currencies such as the Australian Dollar usually struggle as investors seek safe haven investments for their money. Due to this the Australian Dollar has come under pressure lately due to the trade war between the US and China.

Australia has a heavy reliance on China purchasing it’s exports and as such any fall in Chinese growth has a knock on effect on the Aussie.  There has been steep fall  in Chinese trade activity for last month caused by the ongoing trade impasse with the United States.

Could there be further rate cuts from the RBA?

Another factor in the value of AUD has been the Reserve Bank of Australia’s (RBA) decision to cut interest rates to a record low of 1.25% earlier this year. This was an attempt to boost inflation towards the RBA’s target level of 2-3%. Based on comments from RBA members earlier this year there are predictions in the press that we could  see  more rate cuts later this year. This has the probability to weaken the Australian Dollar.

Those with an Australian Dollar requirement should keep an eye out for Australian employment data due out in the early hours of Thursday. Unemployment has risen in Australia of late, which was a contributing factor in the RBA’s recent rate cut, and if this is reflected yet again in May’s figures then the Aussie could lose value.

Comments from any RBA members following this data release could give an insight to monetary policy moving forward could therefore have an impact on the Australian Dollar.

Australia’s problems do not have the same weight as those of the UK’s, with no Prime Minister and Brexit in limbo, the Pound could be set for further losses, with the majority of candidates up for Tory leader ready to bring a ‘no deal’ back to the table. I expect Sterling to remain fragile for the foreseeable future.

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 minutes 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 18 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.

Australian dollar forecast; Will the RBA cut rates again?

The Reserve Bank of Australia cut their base interest rate recently which has seen the Australian dollar weaker in recent weeks. Interestingly, the currency itself did not weaken massively on the news of the cut to historical lows last week, partly because the market was expecting it. It appears to me that the future, we might well in find the RBA forced to cut rates again.

My overall belief is that the factors which contributed to a weaker Aussie dollar in 2019 will by and large remain. A key factor in all of this is of course the trade wars with Donald Trump putting pressure on the global economy, in particular the Chinese economy which is a major customer for Australian exports.

The resulting slowdown globally is only going to continue in my opinion, this will surely keep pressure on the RBA and perhaps force their hand again down the line. It is probably worth pointing out that the Australian economy has been through one of the longest periods of economic growth in history in the Western world. Economic history suggests that at some point that growth will struggle with tougher economic times and the current trajectory and stagnation seems tricky to just shake off with just one interest rate cut.

There is important economic news for Australia this week with the release of the latest news from the Australian Bureau of Statistics, releasing more detailed information on Australian Unemployment data. This has been a key component of decisions on interest rates, as the RBA grapples with falling Unemployment and also falling Inflation.

The future looks far from straightforward for the Australian dollar, clients with a position to buy or sell Australian dollars might benefit from a quick review with our team, to get the latest news and information on their options and the best strategy to maximise any transfers.

Will more disappointing data for the UK today result in further falls for the Pound?

It’s been a disappointing week for UK economic data releases so far, which has come at a bad time for the Pound as the currency is already trading at the lower end of it’s recent trading ranges. The Pound to Aussie Dollar pair in particular is trading in the early 1.80’s, and at the time of writing it’s trading at 1.8150 which is towards the lower levels of the day.

1.80 could act as a support level for the Pound, but those of our clients and readers monitoring the pair should be weary of potential further falls for the Pound as not only is the currency under pressure owing to political uncertainty, but economic data is now starting to disappoint which could cause further falls.

So far this week both manufacturing and construction data has shown a slowdown from the previous figures. At 9.30am this morning there will be the release of Services PMI which is arguably more important as the services sector covers around 80% of the UK economy. I think a drop in these figures could result in a sharper sell-off than we’ve seen this week due to the importance of the sector to the UK economy.

Data aside, the leadership contest for the Conservative Party could be the next potential market mover, as the victor’s attitude to Brexit is likely to impact markets. Down under we have seen the Australian economy pick up slightly but there are still expectations of further interest rate cuts later this year after the recent cut, so this is a potential downside for the Aussie Dollar moving forward.

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.

May’s future in doubt (Daniel Johnson)

Pound to Australian Dollar Forecast

Sterling has suffered of late due to the current situation on Brexit, Brexit being one of the key drivers on GBP/AUD. We recently saw a spike up to 1.88 following what was deemed to be positive news on Brexit. May’s talks with Corbyn over a deal that could be mutually acceptable from both Labour and the Conservatives caused the Spike. I believed the gains for Sterling would be short lived as I had little faith the talks between May and Corbyn would result in a deal that would pass through the House of Commons. This proved to be true.

I believe Sterling could be in for further losses as if Farage’s becomes the UK’s representative in the bloc, it would show a huge power shift away for m the usual top contenders, creating further political uncertainty. Many believe if he does prove to be  successful this could be the final nail in the coffin for May and she will be forced to step down, she has proved extremely resilient up to this point however.

May made a speech yesterday and she stated the House of Commons vote on her deal may now be delayed from the first week of June. This was not taken well and has seen her unpopularity grow. The thoughts in many of the voters minds is no doubt that if her deal fails to be passed she will resign.

I think the vote is destined to fail when it takes place, this may be already factored into GBP/AUD to some extent as the market moves on rumour as well as fact, but I think this could also cause the Pound to lose value. The usual market reaction if a leader of a Country steps down or is ousted is that the currency in question would weaken, however in this situation we could see the opposite as anew Tory party leader may be deemed to have a better a chance of sorting out this Brexit mess.

The Aussie has had it’s own trouble, Australia has a heavy reliance on China purchasing it’s goods and services and any decline in Chinese growth will impact the Australian economy and in turn the Australian Dollar. The escalation in the US/China trade war is causing investors to move away from riskier commodity based currencies such as AUD for safe haven investments.

There is also the probability of an interest rate cut from the Reserve Bank of Australia next month, so despite the potential for further Sterling gains it may be wise to move before the decision if you are selling the Aussie.

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 18yrs, 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.

 

 

 

 

Australian Dollar Weakness as US China Trade War Escalates (James Lovick)

The pound to Australian dollar exchange rate has rallied higher following the latest developments over the US China trade war. Rates for GBP to AUD are now sitting just below 1.87 presenting a good opportunity for buying Australian dollars. The Australian dollar has come under pressure after US President Donald Trump has delivered on his promise to impose tariffs of 25% on $200 billion of Chinese exports.

The Australian dollar is sensitive to the US / China trade war as Australia have a heavy reliance on China for trade. If the trade war continues or escalates further then the Australian dollar could see further weakness. China has already retaliated having made the decision to hike tariffs on up to $60 billion worth of American goods. The fear is that Donald Trump could impose tariffs on all Chinese goods which could bode badly for the Australian dollar.

Brexit meanwhile remains a major driver for GBP vs AUD and the European elections to held 23rd May could see much volatility for the currency pair. British voters are expected to punish the two main parties in a way that has never been seen before. A huge shift to the Brexit party could help change the direction of Brexit. A cleaner break between Britain and the EU could start to look more likely although this would likely be seen as negative for the pound as the uncertainty attributed with a no deal Brexit would return. If however there is a shift to Remain supporting parties then the opposite is true and the pound could rally although this seems less likely looking at the current polls. Those looking to buy or sell Australian dollars would be wise to plan around these EU elections as they represents a major event and could result in high volatility.

Australians are also set for their general election to be held at the end of this week which could see further volatility for the Australian dollar. New rules however will insist that the next Prime Minister will serve a full term after so many changes in the top job in recent Australian history. Elections can always result in market volatility but if anything having the confidence for a longer term bringing some stability and continuity in governance could be seen as positive for the dollar.

For more information on the Australian dollar and for assistance in making transfers then please contact me James at jll@currencies.co.uk

Sterling starts the week strongly with GBP/AUD trading north of 1.86, will GBP/AUD test it’s annual highs again soon?

The Pound has begun the week on the front foot this morning, with GBP exchange rates generally up across the board of major currency pairs. GBP/AUD is up by over half a percent, with the pair now trading around the 1.8650 level which is around 2-cents from the best levels of the past year.

There could be further price changes this week, especially towards the end of the week as Australians will be going to the polls to vote on the Australian Federal election. There has been a lack on continued leadership down under as many of our readers that follow Australian politics will be aware of. Over the past 12-years there have been 6 different prime ministers and the current leader, Scott Morrison of the Liberal-National coalition is currently polled in 2nd place. Another change of leadership could cause weakness for the Aussie Dollar, as Morrison has only been in power since August of last year so another change could increase uncertainty for the Australian economy moving forward.

There will also be inflation data released out of Australia towards the end of the week, and a weak reading could put pressure on the Reserve Bank of Australia to cut interest rates at their next opportunity, so again this is another potential market mover.

The main influence on the Pound’s value is likely to be the cross party Brexit talks between the Conservative and Labour leaders. We’ve seen updates on the talks move GBP exchange rates in both directions recently, so it’s worth being aware of if you’re planning on making a GBP transfer soon.

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 forecast : Will the Australian dollar rise or fall in May?

My view is that the Australian dollar could be on the back foot now as investors become more concerned about the RBA (Reserve Bank of Australia) cutting interest rates. The RBA will meet next Tuesday and there are some who think there is an increased chance of an interest rate cut, owing to some lower inflation numbers released in April. We also have the Australian election due on the 18th, the Australian dollar could therefore be in for a busy month.

The RBA has been in a holding pattern on interest rates for quite some time despite various changes in sentiment since 2016 when the RBA last cut rates. There has been continued speculation the RBA would need to cut again following increased concerns over the economic outlook in Australia, following the trade wars between the US and China.

With the trade wars concerns gently fading under the impression the two sides will strike an agreement, there has been less pressure on the Aussie dollar in recent weeks but the backdrop of such issues looks like it will continue to weigh on sentiment. Even if the US and China do pass a new deal, it is clear that global trade has changed forever under Trump, and the Aussie dollar as a currency so closely linked to global trade, will continue to be influenced by this news.

For me, May is more about the domestic issues facing Australia with low inflation prompting analysts to believe a cut is the way forward for the RBA. Whilst I am not overly confident the RBA will cut, I expect they will comment that they may well do in June, which I believe will weaken the Australian dollar.

The election on the 18th May is also a reason for concern in May, with the Labour party looking to perform well which could well have a negative outcome for the Australian dollar, since they have numerous plans to spend more. The election is likely to be a very topical even over the next 2 weeks and may well sway the Aussie dollar, increased volatility should be expected.

May looks set to be a very busy time for the Australian dollar so if you have any transactions that you are considering, please do not hesitate to contact me to discuss the latest news and forecasts, which will influence the value of your transfer. I work as a currency broker and can offer guidance as to some of the best strategies to consider when making an Australian dollar currency transfer.

Thank you for reading and please contact me directly to learn more on jmw@currencies.co.uk

Jonathan Watson