Tag Archives: bank of england

Sterling suffers against AUD (Daniel Johnson)

Poor inflation and poor Retail Sales data could push back BOE rate hike

We have seen very positive news from the UK of late. We have had UK unemployment come in at a 43yr low, a rise in average wage growth and previous retail sales figures came in at 0.8%, well above the expected 0.4%.

We have also recently had news that a Brexit transitional deal has all but been agreed, with the UK having access to the single market until full exit.

GBP/AUD moved as high as the 1.84s. We have seen the Pound take losses over the last few days however. It first took a hit following a fall in inflation pushing away the probability of a rate hike from the Bank of England (BOE) in May. Inflation has now fallen below average wage growth which some may deem as positive, but if people are making more money and not spending it, it does not bode well for the UK economy.

Yesterday there was a sharp fall in retail sales. There was predicted to be a drop from 0.8% to – 0.5%, but they landed at a shocking – 1.2%. The markets remained muted, which surprised me as this surely brings into question a rate hike in May. There was little Sterling weakness.

It was a dovish speech from the Head of the BOE, Mark Carney to convince investors the hike could be put off until later in the year. The pound weakened as a result.

Despite this I still feel the Aussie is fragile. With no hikes planned by the Reserve Bank of Australia (RBA) this year and the US dollar proving to be far more attractive to investors due to higher returns and safe haven status I am not convinced we will see GBP/AUD drop below 1.81. If I was an Australian Dollar seller buying the pound I would take advantage of current levels. Aussie Buyers aim for the 1.84s, 1.85 is proving to be a firm resistance point.

If you have a large currency transfer to perform in the coming days, weeks or months then I will be happy to speak to you directly as I will be willing to help you both with trying to time a transaction and getting you the best possible rate when you do come to trade. A small improvement in a rate of exchange can make a significant difference so for the sake of taking a few minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can contact me (Daniel Johnson) on dcj@currencies.co.uk and I will endeavor to get back to you as quickly as possible. Thank you for reading.

 

Pound to Australian Dollar rate trading at annual high, will the pair now climb higher? (Joseph Wright)

The exchange rate for changing Pounds into Aussie Dollars has traded within half-a-cent from its annual high today, as the almost hit 1.85 again during today’s trading session.

As many of our regular readers will be aware, sentiment surrounding the Pound has improved quite considerably recently after roughly a month ago the UK and EU Brexit negotiators came to an agreement regarding the Brexit transitional deal. This was a topic that limited the Pound’s value prior tot he agreement, as there were concerns that there would be a Hard Brexit which most likely would’ve resulted in a weaker Pound due to the shock to the UK economy.

Now that there is likely to be an interest rate hike from the Bank of England next month, sentiment is improving as the UK economy is showing signs of picking up, even if the Brexit has slowed the economy somewhat.

Moving forward, I wouldn’t be surprised to see the Pound climb from its current levels as I think AUD will continue to lose value throughout the year. Now that the Fed Reserve has begun hiking interest rates in the US, AUD is likely to lose some of its attractiveness as it will no longer be offering one of the highest interest rates within the developed world. At the same time trade tensions between the US and China are likely to limit upside for AUD in my opinion.

There are expectations that the Reserve Bank of Australia will increase interest rates to 1.75% at the end of this year, although up until this stage the RBA has been skeptical due to the overheating property market down under, particularly on the East coast. With the RBA being weary of the effects this could have on the Australian economy, I think they will leave it late before making an amendment.

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.

 

Could GBPAUD continue towards 1.90?

Since the start of the year GBPAUD exchange rates have improved by over 10 cents, and clients converting £200,000 into Australian dollars are now achieving an additional 25,ooo dollars. 

The Australian dollar continues to struggle on due to the over inflated housing market which is a reason why the Reserve Bank of Australia continue to keep interest rates on hold at 1.5%. Furthermore ‘trade wars’ between the US and China (Australia main trading partner), is causing investors to move away from risky commodity currencies such as the Australian dollar.

The pound has had a good run of late due to the UK securing a transitional deal and the Bank of England hinting that an interest rate hike is likely for June. Today the UK will release their latest average earnings numbers and on Thursday their latest inflation numbers. The consensus is for average earnings to outpace inflation for the first time in many years.

If this is the case, an interest rate hike looks almost certain and therefore I expect the pound may rise slightly against the Australian dollar. However I expect that the market has already priced in the interest rate hike in May, therefore I don’t see the pound making substantial gains.

Looking further ahead I don’t believe it’s all smiles for Australian dollar buyers. The most important element of Brexit is to be decided which is the trade talks. Over the last 18 months we have seen the pound come under pressure when a fresh round of Brexit talks begin. If you need to purchase Australian dollars short to medium term, this week could provide the best opportunity for some time to come.

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.

Will the Pound improve against the Australian Dollar or be caught out by the recent bad weather?

The Pound has continued to remain strong against the Australian Dollar and although we have seen a small drop in the value of GBPAUD exchange rates I still think we could see further gains for the Pound in the long term.

The interest rate down under is now lower than that on offer in the US and this was one of the reasons for the Australian Dollar’s recent demise against the Pound.

If you’re a global investor and you’re offered a higher yield in the US, who are also showing strong signs of growth, why wouldn’t you move funds away from riskier commodity based currencies such as the AUD in favour of the USD?

The Reserve Bank of Australia has recently confirmed that interest rates will be staying the same for the time being meanwhile the Bank of England have demonstrated that they may be looking to increase interest rates in the UK in the near future.

The recent vote by the MPC was 7-2 in favour of keeping interest rates on hold and clearly there is an appetite for an interest rate increase.

UK Average Earnings have recently surpassed inflation levels and in my opinion I think this allows the central bank room to seriously consider raising rates and I think this could possibly happen next month which could give the Pound a further boost against the Australian Dollar.

On Tuesday we could see some potential movement for the Pound vs the Australian Dollar with the latest NIESR GDP estimate for the last three months. Owing to the recent bad weather in the UK I think this estimate could cause a lot of volatility so make sure you’re well prepared for the movement on GBPAUD rates.

Having worked for one of the UK’s longest established currency brokers for 15 years I am confident of being able to offer you bank beating exchange rates as well as helping you with the timing of your transfer.

Please send me an email with your particular requirement and I will come back to you with a detailed response.

I look forward to hearing from you

Tom Holian teh@currencies.co.uk

AUD Forecast – Concerns Over Global Trade Continue to Weigh Heavily on the AUD (Matthew Vassallo)

The AUD has lost some ground against Sterling overnight, with the pair trading 1.85 during Wednesday morning’s trading.

The AUD has come under pressure lately, having found plenty of support around and below 1.80 for long periods.

The Pound itself has had a very positive week following a strong run of UK economic data. Investor confidence in the Pound soared as UK Unemployment figures fell, Retail Sales figures exceeded expectation and there was even a nod from the Bank of England (BoE) that they may look to hike interest rates over the coming months.

This positive feeling was cemented as reports regarding a Brexit transitional deal surfaced. These reports were later confirmed, with the UK & EUR all but agreeing the terms of the deal, which included access for the UK to the single market & customs union during the two year period.

This positive sentiment helped support Sterling’s rise against the AUD, which itself has come under increasing pressure of late in line with a slowdown in global growth.

Investors have been pulling their funds away from riskier assets such as the AUD, with fears that President Donald Trump’s imposed tariffs on imported goods good have a serious knock on effect for the global economy. As regular readers will know the Australia relies heavily on sustainable global growth to boost its export driven economy and any slowdown inevitably has a negative knock on effects for the AUD.

With US/China trade wars also impacting investors risk appetite, particularly as China demand for Australian goods & materials is so essential to the Australian economy, the AUD may struggle to make any sustained impact back to or below 1.80 against Sterling in the short-term.

Whilst Brexit fears have not completely subsided, with many questions regarding future trade relationship’s still to be answered, I would be tempted to protect any AUD currency positions and avoid the risk of further downturns.

If you have an upcoming AUD currency transfer to make, you can contact me directly on 01494 787 478. We can help guide you through this turbulent market and as a company we have over eighteen years’ experience, in helping our clients achieve the very best exchange rates on any given market.

Our award winning rates can be accessed very easily over the phone and I can keep you posted with key market developments ahead of any prospective exchange you need to make.

Feel free to email me directly on mtv@currencies.co.uk to find out all the options available to you ahead of your currency transfer.

How high could GBPAUD rates go?

The pound to Australian dollar exchange rates has been touching fresh highs as the pound rises and the Australian dollar weakens. A key factor in this trend has been the shift on the US dollar and the UK with interest rate hikes since both the UK and US are looking to raise interest rates whilst the Australian dollar has been weaker because there are no hikes planned.

This trend seems likely to continue in the weeks ahead as we learn more around the Bank of England who appear very keen to hike interest rates in the future. This will be data dependent but the path ahead is looking clearer which will only help the pound further in the future. The same too is definitely true of the US dollar and the US Federal Reserve who are likely to raise rates up to three more times this year.

As the US interest rate is higher now than the Australian interest rate it makes less sense to hold Australian dollars than US dollars. This has seen a big shift in USDAUD exchange rates which is weighing the Aussie dollar down against the pound and presenting much better opportunities to buy AUD with sterling.

The next really key news is this Thursday with the latest UK GDP (Gross Domestic Product) data which could influence GBPAUD rates. I don’t think this will be a majorly important release but next week could see increased volatility with the latest Australian interest rate decision and important US Non-Farm Payroll data released.

I would not be surprised to GBPAUD pushing higher and we could easily hit 1.90 or the high and mid 1.80’s in April. If you are selling Australian dollars to buy pounds moving sooner than later seems the best bet. Otherwise targetting a more beneficial rate on any spikes might prove a profitable and worthy approach.

If you have any transfer buying or selling Australian dollars then understanding the latest news and trends can help you to maximise your rate by trading at the right time. For more information please speak to me Jonathan Watson by emailing jmw@currencies.co.uk.

Thank you for reading and I hope like our website and information.

 

GBPAUD hits 1.80!

The pound to Australian dollar exchange rate is currently rising and has hit the magical 1.80 level this afternoon. This is presenting some of the best fresh opportunities to buy AUD with sterling since the Referendum. This is a very important psychological level of resistance and now this is breached we might struggle to get back below if certain conditions are met.

These conditions stem from a technical analysis of the market that states, generally once a rate has broken a certain level and can remain above it consistently, it will then be more likely to remain above that price. The belief on the rates is that this needs to be sustained over a few sessions for it to be seen as a consistent move. Much will now depend on sentiments towards the ongoing events which have of course driven this shift on the exchange rate.

I feel the pound will now continue to rise against the Australian dollar, this move has been widely expected and appears to be the path of least resistance. With little sign the RBA (Reserve Bank of Australia) will be raising their base rate anytime soon, the Aussie will in my opinion remain on the weaker side.

Sterling is rising on increasing confidence over what lies ahead on Brexit, next week’s EU summit will be a major driver on the GBPAUD pair. Important too will be the latest news from the US Federal Reserve Bank on Wednesday next week, as they look to raise interest rates. A stronger US dollar has seen a weaker Aussie in recent months and years, this could be a very important week ahead for GBPAUD rates!

If you have any Australian dollar transfers buying or selling then making plans around important events is the best way to maximise your transfers. For more information free of charge and at no obligation please speak to me Jonathan Watson by emailing jmw@currencies.co.uk.

Thank you for reading and I look forward to hearing from you.

Predictions of a higher GBP/AUD rate mount as Brexit transitional deal hopes grow (Joseph Wright)

The Pound to Australian Dollar exchange rate climbed during today’s trading session, with the pair now trading almost at the very top of the current trend.

The mid-market level for the pair hasn’t breached 1.80 in some time but the pair are currently trading in the 1.78’s, meaning that for those planning on making a GBP to AUD transfer are looking at attractive levels considering recent trading levels. I would add that the lower end of the trend is 1.60 so hopefully you can see my reasoning as to why the current levels are around the top of the market.

There are hopes that the Pound will climb further, and this week the Brexit Secretary, David Davis said that the UK ‘can live with’ a shorter transitional period which has boosted the Pound’s value along with the likelihood of UK interest rates climbing sooner than many had expected.

Analysts at Lloyd’s Bank have recently upgraded their forecasts for the Pound to Aussie Dollar rate this year. They had previously expected to see the pair trade at 1.72 at the inter-bank level although the changing tones from the Bank of England and the Reserve Bank of Australia has changed their minds, with them upgrading their views on the Pound’s potential.

There isn’t any major economic data coming out of the UK or Australia this week, so I expect the pair to be driven by politics for the remainder of the week.

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.

What factors could push the Pound to Aussie Dollar rate above 1.80 this year? (Joseph Wright)

The Pound to Aussie Dollar rate has been hovering just below the 1.80 mark for some time now, and although the GBP/AUD pair appear to have consolidated between 1.75 and 1.80 the pair are yet to properly test the 1.80 threshold.

AUD has been boosted in the early hours of this morning after the Reserve Bank of Australia’s minutes from their latest interest rate decision were announced. The RBA remains positive focusing on wage growth and a pick-up in the global economy moving forward which could lead to a rate hike from the RBA later in the year.

The topic of a rate hike in Australia is likely to be key moving forward as a number of other major economies have begun hiking rates now. AUD had previously benefited from having some of the highest interest rates available in the developed world but as other currencies now offer similar returns AUD has lost its appeal somewhat, and this issue is what could give the Pound a chance of gaining on AUD pushing the GBP/AUD above 1.80.

JP Morgan recently offered their opinion on the Aussie Dollars prospects and suggested the currency could fall as weaker commodity prices and monetary policy divergence put pressure on the AUD’s value.

There is an important data release out this morning from the UK in the form of Average Earnings data. This is key because the figure has disappointed recently and struggled to keep up with inflation levels which had previously made the BoE hesitant to hike interest rates. Should wages have increased over the past 3-months the chances of a rate hike are improved so I would expect to see a jump in the Pound’s value should this be the case.

Planning around events such as these can prove beneficial, so do feel to get in touch to discuss any upcoming transfers you plan on making.

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 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.