Tag Archives: australian economy

Pound to Aussie Dollar range-bound, but where to next? (Joseph Wright)

The Pound to Aussie Dollar exchange rate has been trading between 1.66 and 1.68 for a few days now, as the pair appear to have consolidated below 1.70 in the wake of the disappointing election outcome for Sterling bulls.

As of yet there is no official agreement between the Conservatives and the Democratic Unionist Party (DUP) although speculation is mounting as to the amount the Conservatives will have to pay for the coalition, with some speculating amounts of up to £2bn.

Moving forward I’m expecting any news of the coalition to have a potential impact on the Pound to Aussie Dollar buying rate, which is where keeping in touch with us can really help as we’re able to act whenever there’s a big short term move.

Brexit negotiations are now also underway, which is another issue for the government to deal with along with the ongoing Grenfell Tower tragedy and the recent terrorist issues.

On the other hand the Aussie Dollar has been under pressure in recent weeks as the Chinese economy appears to be slowing, which is a negative for the value of AUD as the Australian and Chinese economies are key trading partners.

With both currencies coming pressure for different reasons, it could be that the weaker of the two that results in further price movement for the GBP/AUD pair.

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 Forecast – Will the AUD Continue to Strengthen? (Matthew Vassallo)

GBP/AUD rates have remained flat during Thursday’s trading, with the Pound curbing any further losses following its recent downturn.

Much has been made of the Pound’s detraction, which has come in line with a grave market concern surrounding the political limbo and subsequent economic concerns surrounding the UK economy at present.

UK Prime Minister Theresa May’s decision to call an early election backfired spectacularly and with UK Brexit negotiations already under severe strain and constant scrutiny, investors have turned their back on Sterling.

The AUD continues to surprise and with an upward spike of over 8 cents in the past few weeks. This has helped propel the AUD to near two month highs against GBP and as such many clients will be looking to take advantage of the current rates, with GBP/AUD trading around 1.68.

The AUD is likely to find protection under 1.70 but with the current market unpredictability, any exposed positions could be hit hard by a change in market sentiment.

Being a commodity based currency the AUD relies heavily on global growth remaining strong and whilst the current climate is pushing investors towards the AUD and its higher yielding interest rates, any slowdown in its export sector will hit the Australian economy hard and the AUD will almost certainly suffer as a result.

A strong AUD relies heavily on the export of Australia’s vast supply of raw materials to China, so any clients looking to buy or sell AUD should have a strong interest in Australia’s monthly trade balance figures.

With the UK economy flagging and the tough Brexit negotiations likely to dominate headlines for months to come, it is proving extremely difficult to predict any long-term forecast.

As such I have been advocating that my clients look for short-term market spikes and any spike back towards 1.70 should be taken advantage of by AUD buyers, whilst sellers will be hoping for the recent trend to continue, with a move towards 1.65.

Now is the time to contact a personal currency broker and here I can help guide you through this turbulent market. I assist my clients with the timing of their currency transfers, to ensure that any market value is maximised.

We can offer award winning exchange rates & service, which surpass any of our competitors.

Please feel free to contact me if you would like to be kept up to date with all the latest market movements, or simply wish to compare our rates to those of your current provider.

I am available on 0044 1494 725 353 between 08.30-18.00 and just ask one for the team for Matthew. Alternatively, I can be emailed directly on mtv@currencies.co.uk

Volatility expected on GBP/AUD in the next 24hrs as government announcment expected (Daniel Johnson)

Queens Speech has potential to cause movement on GBP/AUD

Tomorrow we will see the state opening of parliament and the queens speech which had been delayed as the conservatives and the DUP thrash out a deal. The UK is currently in political limbo at present and this has been very detrimental to the pound, if we go by what is taught in economics class you would expect the pound to rally once there is a government in place. It is common knowledge that we will see a conservative-DUP  coalition and the market will have largely factored this into the current GBP/AUD rate.  What I think will have more bearing is what plans the coalition have for the country particularly regarding the brexit strategy. A change from Theresa May’s hard brexit plan could well occur, as the DUP would favour a soft border between Northern Ireland and Ireland, this would mean a move away from May’s plans of border control and a hard brexit. It is important to also note that senior members of the conservatives have threatened to challenge May’s leadership if she changes her plans on  a hard exit. If you have a currency trade to perform involving GBP/AUD you need to be in touch with an experienced broker if you want to take full advantage of short term spikes. There are a number of options to ensure any tempting peaks which emerge are not missed and if you would like me to help, be sure to get in touch in quickly so I am aware of your situation and can assist in maximising your return. My details are at the bottom of the article.

 

RBA Minutes gives an indication of what could influence future Australian Dollar value

The Reserve Bank of Australia (RBA) minutes  take place two weeks after the interest rate decision. They provide an account of policy discussion and also how the committee voted. This can give a real indication of what monetary policy changes can be made in the future and can influence GBP/AUD.

The minutes took place during the early hours of this morning and is was much the same as the previous meeting, interest rates were kept on hold at 1.50%. Housing and employment will be key factors in interest rate judgement as detailed in the minutes.

Data will continue to hit the wire throughout the month regarding these key indicator, affecting the value of the Australian Dollar consistently. Feel free to get in touch if you would like me to keep an eye on these releases for you, I can contact you if an opportunity presents itself.

Should you find our information useful and you would like me to assist with your trade I will be happy to help you personally. If you inform me of the details of your trade I will endeavour to provide a free trading strategy tailored to your situation. We are authorized by the Financial Conduct Authority so you can trade with safety and confidence. Our reputation at Foreign Currency Direct is impeccable, we also offer the most competitive rates of exchange and if you have a current provider I am willing to perform a comparison and I am very confident I can demonstrate a significant saving. I look forward to being of help. I can be contacted at dcj@currencies.co.uk. (Daniel Johnson)

GBP/AUD Rates Trading Under 1.70! (Matthew Vassallo)

GBP/AUD rates are once again trading under 1.70, as the Pound’s struggles continue following last week’s unexpected election results.

The Pound has seen its gains over the past month dissipate, with 1.70 becoming a key threshold for the pair.

Those clients holding both Sterling and AUD will now be asking themselves how the pair will react over the coming days? Whilst I don’t anticipate a major advancement for the Pound whilst so much uncertainty hangs over the UK economy, any deal between the Conservatives and the little know DUP party from Northern Ireland, could bring an element of stability back to the market.

Political or economic uncertainty is generally a currencies undoing and the Pound’s struggles over recent days is proof of this. Once a government has been formed, then it is far more likely that investor confidence will rise and the Pound could stabilise as a result. This could have an instant negative impact on the AUD and as such the current sell prices for those clients holding AUD look very attractive indeed.

Whilst the AUD has also been supported due to the Chinese economy stabilising and accelerated growth in its own economy, it is always left somewhat vulnerable due its status as a commodity based currency.

For example, the Trump effect is causing investors to panic and this is unlikely to benefit riskier commodity based currencies such as the AUD in the long-term. The AUD’s value is inextricably linked to Australia’s booming export market and any downturn here will likely knock its value. Due its reliance on global growth a change in fortune for China, or concerns regarding the US can cause investors to sell off their riskier assets (such as the AUD) and move funds into ‘safe haven’ currencies such as the CHF.

Ultimately, this means that investors will look to GBP/AUD for example and see the opportunity to make more money on bigger market swings and thus, the pairs value can fluctuate quite substantially.

The current market is extremely unpredictable and with global growth fragile and concerns over the UK economy ahead of what is likely to be arduous Brexit negotiations, I would be tempted to look for short-term market opportunities.

If you have an upcoming GBP or AUD currency transfer to make and would like to be kept up to date with all the latest market movements, or simply wish to compare our award-winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 787 478 and ask one of the team for Matt.

Alternatively, I can be emailed directly on mtv@currencies.co.uk.

The UK Continues to Mourn Terror Attack – How is the Pound Reacting? (Matthew Vassallo)

As the UK continues to mourn Saturday’s horrific terror attacks, the question clients have asked me this week is how the Pound will react to the tragic events?

Whilst the markets may not have responded as aggressively as in the past, terrorism no doubt plays a part in investors thinking, with a lack of confidence around the economy in question usually the likely outcome.

Sterling was already under pressure against the AUD, with the pair moving back towards 1.70. The Pound did find some support yesterday however, with a recovery back toward 1.73 but whether this spike is sustainable or not is questionable at best.

The Pound has been fighting an uphill battle ever since it was announced that the Torries had a 20 point lead over the Labour party and the markets factored in such figures. Every pre-poll since has indicated a surge in support for Labour and with the most recent suggesting the Conservatives were only ahead by three points, has caused inventors to panic and sell-off their Sterling positions.

This in turn has benefited commodity based currencies such as the AUD, which has found plenty of support under 1.75 over the past couple of weeks.

Looking at the Australian economy and with iron ore prices low, this would usually have a detrimental effect on the value of the AUD due to Australia’s heavy reliance on their export industry. However, currently this is seen as the lesser of two the evils by investors and as such I would be taking advantage of the current sell rates if I was holding AUD.

Anyone who has an upcoming Sterling or AUD currency transfer to make can get in touch with us to run through the current market conditions & forecasts. We can assist not only with our award winning exchange rates but also our experienced insight into the current market to help guide you through your currency exchange process.

I am available on 0044 1494 787 478 and you can ask one of the team for Matt. Alternatively, I can be emailed directly on mtv@currencies.co.uk  

Will the issues surrounding the Australian property market weaken AUD further? (Joseph Wright)

The Pound to Australian Dollar exchange rate hit 1.7430 at it’s highest point during today’s session, although at the time of writing the Pound appears to have lost all of today’s earlier gains.

It’s difficult to tell which way the rate will move next, although I think that it will be underlying weakness that results in the next big move for the GBP/AUD pair as both currencies are coming under pressure for differing reasons.

China was downgraded by Moody’s (a credit rating agency) for the first time in 30 years due to slowing growth in the region although markets haven’t overreacted as a slowing in growth was inevitable.

This could spell bad news for the Aussie Dollar moving forward due to the interconnected economies (Australia and China) being quite reliant on each other. At the same time further talk of the property markets in Sydney and Melbourne overheating are surfacing again, and with a slowdown in the construction sector down under becoming a talking point as well I think there could be issues for AUD later down the line.

The Pound has also come under pressure due to the terrorist attack earlier this week, and with the election just around the corner we could see further headwinds for the Pound as we get closer to the election date (the 8th of June).

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.

UK Mourns Terror Attack – AUD Market Update (Matthew Vassallo)

The UK is in mourning once again following last night’s horrific terror attack in Manchester, the worst on these shores since the London bombings.

Our thoughts and prayers are with the families of the victims involved, with the UK needing to pull together in times of such adversity.

The markets have just started to react following the disaster and as the trading day gets underway, the Pound still finds itself under pressure against the AUD.

GBP/AUD rates have dropped to 1.73, with the AUD benefiting from Sterling’s downfall. In truth, the Pound was struggling for much of yesterday, having made inroads against the AUD last week.

Sterling had threatened to make a move to 1.80, as the Pound found plenty of market support before hitting resistance under this key threshold. This negative trend was intensified yesterday, with reports surfacing that Brexit negotiations have already hit a wall already.

The UK have said they are willing to step away from negotiations, which backs up the Prime Minsters tag line that “no deal is better than a bad deal”.

The AUD gained almost two cents at yesterday’s high and the question now is whether this trend is likely to continue over the coming days?

I have continually advocated that clients look for short-term opportunities in the current market and the recent downturn is testament to this.

No one can predict exactly how a currency pair will evolve but with so much uncertainty surrounding the UK, in regards to what deal we will negotiate in our exit from the EU and upcoming general election, now is not the time to be gambling on a consistent upward trend for Sterling.

Similarly, the AUD itself is struggling again a backdrop of uncertainty. Iron Ore (Australia’s largest export) prices have fallen sharply, which is bad news for commodity and export economies such as Australia’s. The reasons attributed to this fall was put down to recent oversupply but with China’s (Australia’s main purchaser of iron ore) economy clouded in mystery, there are many variables to consider and the AUD has lost investor confidence as a result.

Whilst the current malaise is likely to restrict any major advancements for the AUD, as I’ve already alluded to investor confidence in the UK economy and the Pound, is fragile at best.

Client should look to protect their upcoming currency transfer by way of a forward contract wherever feasible and be realistic with any rates they are targeting in the current market.

If you have an upcoming GBP or AUD currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award-winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 787 478 and ask one of the team for Matt.

Alternatively, I can be emailed directly on mtv@currencies.co.uk.

Pound to Aussie Dollar rate continues to fall over UK economic outlook concerns, will the downward trend continue? (Joseph Wright)

The Pound to Aussie Dollar exchange rate fell into the 1.73’s earlier today as the downward pressure upon the Pound continued.

Despite still trading in the 1.70’s the GBP/AUD pair has fallen from its 8-month high as the currency is falling against all major currency pairs, with the drop against some currencies being steeper than others with GBP/EUR’s fall down to a 5-week low bring one of the standout movers.

The main reason for the softening to Sterling’s value can be attributed to the Inflation rate within the UK and its knock on effects.

The rate of Inflation has risen to its highest level since September 2013 and this is significant as it’s come at a time when UK wage growth is stagnating. Inflation is growing at a higher rate than wage growth which is likely to negatively impact consumer spending within the UK, which is an important aspect of the UK economy.

This situation looks gloomy for the Pound moving forward as the Bank of England has ruled out a rate hike in the short term future, especially with a general election just around the corner.

I wouldn’t be surprised to see the GBP/AUD rate dip below 1.70 in the short term future, unless there’s a reversal in the steep rise of living costs within the UK.

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.

Inflation a worry for Sterling (Daniel Johnson)

Snap Election causes pound strength

We have seen Sterling make considerable gains against the Australian Dollar of late. One of the main catalysts was Theresa May’s announcement that an election is to be held on 8th June. Historically a snap election has weakened the currency in  question, however on this occasion the opposite occurred. It was a shrewd move from the PM to call for an election while the opposition is so weak. The conservatives are some distance in front in the polls and are highly likely to win the election. A conservative victory is considered to be the safe bet for the UK economy, this caused a boost in investor confidence and in turn the pound. The market moves on rumour as well as fact and I am of the opinion a conservative victory is already factored into current GBP/AUD levels.

Iron Ore price causes Australian Dollar to fall in value

Another cause for the fall in Australian Dollar value is the drop in price of Iron ore. Iron ore is Australia’s largest raw material export. The price in iron ore has fallen considerably and is having a significant effect on the value of the Australian Dollar. Australia are heavily dependent on the Chinese and Chinese growth is dwindling, which is hurting the Aussie. Keep a close eye on Iron ore prices if you have a requirement involving the Australian Dollar as this could have significant bearing on your return.

Inflation a big concern for the pound

Yesterday, we saw inflation data released in the UK. There has been a rise in inflation, usually this would be deemed as positive for the economy but in this instance it is worrying. The rise in inflation is caused by the weak value of the pound. Retailers are paying more for their imported products and are now shifting the increase in price on to consumers. Wage growth is not keeping up with inflation so this could warrant consumers to stop spending. I stated this could be a problem in blogs months earlier, keep an eye on inflation levels moving forward as this could be a major stumbling block for the pound.

If you have a currency transfer to carry out in the coming days, weeks or months then you are welcome to speak to me directly. 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  come to buy your currency. A minor improvement in a rate of exchange can make a considerable difference so for the sake of taking two minutes to email me you may save yourself hundreds if not thousands of Pounds. I can be contacted at dcj@currencies.co.uk. Thank you for reading.

Will sour Brexit negotiations continue to weigh on the Pound? (Joseph Wright)

So far this week we’ve seen a very typical pattern of trading for the Pound against the Aussie Dollar.

Political uncertainty has been the main driver of price fluctuations for GBP exchange rates for the past year as the Brexit vote, and subsequent discussions surrounding the process of leaving the EU have continuously weighed on the Pound’s value.

At the same time Sterling has been boosted by impressive economic data during this time which has supported the Pound, so it will be interesting to see which of the two factors have the strongest bearing on GBP/AUD over time.

This week we’ve seen the same pattern continue as the Pound softened earlier this week as over the weekend the tensions between the UK and EU surfaced after the European Commission’s President Jean Claude Juncker commented that UK Prime Minister Theresa May ‘is living in another galaxy’ regarding Brexit negotiations.

Despite the Pound falling in the wake of these comments the currency has since taken a turn for the better as yesterday mornings UK Manufacturing data release came out at its highest level in 3 years. This data showed that sentiment within the UK’s manufacturing sector is going strong at the moment which has been aided by the weaker Pound.

Moving forward I expect data out of the UK to be watched closely as investors will be keen to see how the UK is performing during this crucial two-year period of negotiations.

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.