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GBP/AUD Interbank exchange rate looks set to rally in a bid to avoid upcoming pressures

Both the pound and the Australian dollar have faced issues over the past couple of weeks which have consequently negatively impacted their currency strengths. There are ongoing concerns surrounding the GBP and the UK’s Brexit campaign that has kept investors guessing. The AUD on the other hand is facing a barrage of damages, with US-China trade talks losing traction paired with recent under-performance in economical data captaining the ship of decline.

Both Currencies in a Sorry State to Start the Week

Last week saw an unpredictable sway for the pound, with October’s UK retail sales declining and annual sales seeing the weakest increase in a year and a half. Added to this, the UK’s inflation had slumped to a three-year low. The GBP did pick up a little in the week thanks to some political optimism; signs that the conservatives may pull through and win the election in December gave a boost to the currency.

Meanwhile, for the AUD, a poor performing annual wage growth and an unfavourable consumer sentiment begin to weigh on the Australian dollar. The optimism previously associated with the US-China trade talks declined as the US looked unlikely to agree on a deal unless it was fitting for them. This brought down the value of the AUD, which is heavily affected by the strength of the Chinese economy due to their extensive trading. Australia also suffered its sharpest decline in three years, which has sparked calls for action to help alleviate wages and economic activity.

GBP Looks to Slide Following Bank of England Inflation Report

The Bank of England is set to release its inflation report on Wednesday, and analysts have predicted that the GBP will slump against the AUD following its release. Optimists however suggest that the pound could rise against the Aussie dollar should surveys report back in favour of the Conservative Party reclaiming power in December, which would increase the chances of the UK leaving the EU by the end of January.

Dovish Reserve Bank of Australia Could Weigh on the AUD Exchange Rates

The RBA’s Assistant Governor, Christopher Kent is set to make a speech at the start of this week. There is potential for the AUD to slide against the GBP. This will likely occur if he emphasises the weakness of the Aussie economy and moves towards a ’dovish’ monetary policy. Flashing forwards to Thursday, the AUD could claw back some gains as the Commonwealth Bank services Purchasing Manager’s Index (PMI) is released. If November’s PMI rises are higher than expected, the AUD is likely to rally.

Investors in the AUD will be hoping for a positive response from Thursday’s PMI alongside more positive news from the US-China trade talks. If both proceed in a positive manner there is a chance that the AUD can lift itself out of its current sorry state and reclaim some of its previous gains.

Feel free to email me, Dayle Littlejohn if you would like to know more on the factors affecting the AUD/GBP pairing or have an upcoming currency transfer drl@currencies.co.uk.

Australian Dollar rises with US trade deal progress, but BoE looks to halt progress

The AUD is currently being held captive at the hands of many of the current events around the world. Trade talks with the US and China still rage on, whilst the Bank of England (BoE) discusses its options regarding the rate decision split.

US-China trade deal begins to make some traction

The trade deal talks between the United States and China have been in motion for several weeks now. Progress was beginning to slow as the US president, Donald Trump appeared to be dragging his heels with meeting China’s demands. However, over the past 24 hours, reports have suggested that he is now taking a more open approach and appears to be willing to work to the demands from China.

This news positively affected the Australian dollar as the deal looks more promising with both sides willing to cooperate with each other. This gave a boost to the AUD this Thursday, with hopes that further progress will soon ensue, further strengthening the currency.

Bank of England talks drag down GBP/AUD exchange rate

It looks as though the BoE is hinting at potentially further cutting rates in 2020; this speculation has caused trouble for the GBPAUD interbank exchange rate which fell by 0.6%. Two key members of the BoE voted in favour of a cut in the rate. This caused a split but ended in the interest rate being held at 0.75%. However, the split decision did not win over many, causing the observed loss in investor backing for the GBP.

Aussie trade balance figure saves the day for the AUD strength over the pound

On Thursday, the AUD rose against the pound. This was as a result of September’s Australian trade balance figure being released. The figure reported a raise from 5.926 million to 7.180 million, smashing the forecasts. It was also a good month for Australia’s exports as they ballooned to a new high. Over September, Australia shipped out 43.2 billion worth of services and goods. As a result, the AUD has benefited and new hopes for the Aussie economy have emerged once more.

The AUD is relatively volatile at the minute, but with positive news on the trade deal front paired with positive figures in Australian trade, the AUD appears to be faring well. Buyers and sellers of AUD will keep a close eye on the Bank of England’s stance on interest rates in the coming weeks as rumours of an interest cut suggest it may occur soon.

Feel free to email me, Dayle Littlejohn if you would like to know more on the factors affecting the AUD/GBP pairing or have an upcoming currency transfer drl@currencies.co.uk.

Volatility in the Australian Dollar over the past 24 hours

The Australian dollar has seen both gains and losses over the past 24 hours. Various ongoing events have inflicting shifts on the currency and this has both positively and negatively impacted the GBP/CAD interbank exchange rate.

Trouble for both Australia and the United Kingdom

The relationship between GBP and CAD of late is heavily revolving on the current issues in the news. For Australia, a higher push on the Reserve Bank of Australia (RBA) and global trade news ensued that the GBP/AUD trend continued to slowly decline.

On the other side of the water, the UK is still deeply entrenched in it’s Brexit quarrels. The uncertainty of the upcoming UK election as well as Brexit as a whole has weighed down the British pound.

Recovering GBP/AUD relationship but still at low levels

On Wednesday the GBP/AUD interbank rate was sitting at a level of around 1.86. This figure is a slight improvement on the previous week’s lows but is still a loss of around half a cent since Monday. The AUD is hoping to build on its slight increase with support for the currency as hopes rise that the Australian economy will remain resilient. For the GBP it is not as simple. With the campaign trails of each branch of the British political parties ongoing until next month’s election, this GBP volatility is very likely to continue.

The reluctant GBP deflates chances of prosperity

Amidst the GBP’s struggles with Brexit, investors are currently shying away from making moves on the pound. The outlook for the GBP this week resembles much of last week’s trends. Partner this with the AUD’s struggles of its own the GBP/AUD exchange rate is not performing at it’s best of late.

Investors in the GBP will be turning their attention to today’s Bank of England (BoE) policy decision. Analysts expect the bank not to make any changes to monetary policy yet a dovish tone over the economy in the UK may play a part in seeing the GBP slide.

On the other hand, experts report that there is a chance that the GBP/AUD exchange rate could fall if the BoE shows concerns. Current Sterling optimism could lift if investors become worried about the next Brexit deadline. A concoction of election uncertainty, Brexit jitters and recent weak economic statistics could undermine sterling in the weeks to come.

Today will be an important day for both currencies as the Bank of England undergoes its policy decision whilst Australia’s construction Purchasing Manager’s Index (PMI) for October and trade balance for September is released. If these stats impress the AUD is likely to cling to this week’s gains.

For more sterling and Australian dollar news or if you have a currency requirement you can get in touch with me, James Lovick, directly at jll@currencies.co.uk, or call +44 (0) 1494 360 899 to discuss these factors in more detail.

Pound to Australian Dollar Forecast: GBP to AUD exchange rate makes strong gains

Australian unemployment data disappoints the markets

The pound to Australian dollar exchange rate has made strong gains after Australian unemployment data released this morning disappointed the markets. The interbank rates for GBP vs AUD have rallied higher to 1.8375, at the time of writing. The unemployment level down under rose in August to 5.3% from 5.2% the previous month. The last Reserve Bank of Australia minutes hinted at a weaker jobs markets and the concern now in that the numbers may disappoint further going forward. The unemployment data coincide with recent weak Gross Domestic Product data for the second quarter which was recorded as the lowest in the last decade.

Bank of England expected to leave rates on hold

UK retail sales data is released this morning ahead of the Bank of England interest rate decision at 12pm. The Bank of England is not expected to make any changes to the headline interest rate today with Brexit so close by as well as the growing prospect of a general election. Rates are expected to stay on hold at 0.75% with so many external distractions. This is despite UK inflation data released yesterday which fell to its lowest level since 2016 and below the Bank of England target rate. It has also been reported that in the event of a no deal Brexit then interest rates may be cut further in the coming months.

How will the Supreme court ruling affect the GBP to AUD exchange rate?

Brexit meanwhile continues to dictate the travel for sterling exchange rates and today will see the third and final day at the Supreme Court. The courts are hearing whether it was unlawful for Boris Johnson to prorogue parliament. An outcome may come as soon as today although the top judges may want the time over the weekend to come to a unanimous decision. Expect volatility based on the outcome especially if the courts did rule against the government. Expect high volatility for the GBP AUD pair and those clients looking to buy or sell Australian dollars would be wise to plan around all the latest developments.

The EU have also given the UK until the end of September to produce written proposals which could see a shift on where Brexit is heading. To date the Prime Minister has reportedly progressed discussions on the controversial backstop by providing alternatives where checks could be done away from the border. However the EU are keen to see these proposals in writing, something the British side is reluctant to do at this stage.

For more information on the Australian dollar and assistance in making transfers when either buying or selling Australian dollars please contact me James at jll@currencies.co.uk

GBP/AUD hovers above 1.77 as markets await confirmation of new UK Prime Minister, with Boris Johnson the favourite

After a quiet month or so regarding Brexit updates and GBP volatility, the markets are now gearing up for the announcement of the new Tory leader and Prime Minister with frontrunner Boris Johnson expected to win by a clear majority.

It’s likely that the announcement will be made tomorrow and as we’ve seen over the past weekend there could be Conservative Party members that will wish to step down from their positions if Boris Johnson becomes Prime Minister.

Sterling has gradually lost value since the beginning of May against the majority of currency pairs as the likelihood of a no-deal Brexit has increased. Boris Johnson was one of the key figureheads of the pro Brexit movement and he’s suggested that he’s more open to the idea of a no-deal Brexit and leaving without a deal in place come October the 31st. This is why the Pound has come under pressure so those of our readers following the GBP to AUD exchange rate should be aware of this and the markets perception of Boris Johnson’s plans.

Data is light out of Australia this week, but I would expect all eyes to be on Reserve Bank of Australia Governor Philip Lowe’s speech in the early hours of Thursday morning. Any hints at future monetary policy from the RBA are likely to impact AUD exchange rates so it’s worth keeping an eye on this speech for that reason.

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 : Australian dollar remains in the firing line!

The Australian dollar was always looking like it may struggle in the month of May, and so it has proved to be the case. A series of domestic and global events have all led to increased pressure on the Australian currency, as investors fear over the more immediate political and economic outlook.

On the side of the domestic issues facing Australia, there are numerous economic concerns including inflation being at a 16-year low with stagnating Unemployment a further concern. The Reserve Bank of Australia (RBA) has because of this been under pressure to cut interest rates and it is widely expected will cut at future meetings.

The raising and lowering of interest rates is a big factor in the strength and weakness of a currency, the current projection for lower interest rates down under will only serve to put more pressure on the currency in the future.

Politics is also key in Australia with the national elections due on the 18th May, there is a concern this could be a Labour government which would potentially see the Australian currency weaker. There has been a growing concern over the economic outlook and a Labour government and their spending plans could easily see a weaker currency.

Finally, the global events which are also concerns for the Australian dollar are numerous. This includes the trade wars between the US and China which could see the lack of any agreement weighing on global sentiment and hamper trade confidence in the global economy. As a global currency, the Australian dollar will weaken in times of uncertainty over the global economic outlook and the trade wars are a great example of this.

Moving forward, the Australian dollar looks like it will remain under some pressure and could easily weaken further. A sudden change in sentiment could easily develop however, and clients looking to predict and track movements on this currency should be aware of the potential for a sudden reversal.

To discuss strategy and ensure that you are fully up to date with the latest trends and themes in the market, please don’t hesitate to contact me Jonathan Watson to discuss further on jmw@currencies.co.uk.

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

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

Australian Dollar weakens after RBA comments and how will the Irish backstop issue impact the Pound and the Australian Dollar

The Pound has been improving once again against the Australian Dollar and has moved by almost 4 cents during the course of this week.

The Australian Dollar weakened against the Pound after RBA Governor Philip Lowe’s comments that there was a chance that the Reserve Bank of Australia may be preparing for an interest rate cut later on during 2019.

Tomorrow morning the RBA will announce their latest Monetary Policy Statement, which will cover the issues and the reasons why the members voted as they did at the recent meeting.

The reason why this Statement could be key to the short term future of the GBPAUD exchange rate is because it will give us an insight as to what the appetite is of a future interest rate cut.

With the US Federal Reserve having increased interest rates by 9 times since the end of 2015 although they do not appear to be increasing interest rates at the same pace during this year, the risk for the Australian Dollar is that it does not offer the same yield of interest that is available in the impressive US economy at the moment.

If the RBA do decide to cut interest rates later this year then the likelihood is that this will cause the Australian Dollar to weaken in the future but there are many variable in between including the latest Brexit issues.

UK Prime Minister Theresa May is currently in discussions with European leaders to try and sort out the issue of the Irish backstop as the UK and the EU are currently at loggerheads as to how this scene will play out.

The Bank of England are also due to meet today to decide their latest monetary policy decision. Clearly at the moment there is little chance of any change to interest rates whilst we are just 7 weeks from when the UK is due to leave the European Union so it will be the accompanying press conference that will provide any clues as to what will happen to the Pound vs the Australian Dollar. Bank of England Governor has been rather cautious in his tone towards Brexit so any more of the same could see a small wobble for Sterling later on today.

If you would like a free quote when buying or selling Australian Dollars then contact me directly and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

 

Australian dollar at the mercy of global news!

The China – US Trade Wars have been a major factor driving the currency markets in the last 6-9 months, impacting the Australian dollar and the economy. Australian economic data has been mixed but with Chinese data reflecting a slowdown, particularly in Manufacturing, the Australian dollar has been softer.

Looking ahead there is lots of important news in the currency markets this week to move the Australian dollar, this includes information at home and abroad. Domestically we have the latest Australian CPI, Consumer Price Inflation, data to move the market. The Australian economy has been mixed and investors are still debating the prospect of interest rate hikes in the future.

Tomorrow is also important with the latest US Federal Reserve interest rate decision, which could be a market mover on the US dollar and thereby impact the Australian dollar. USDAUD is the most heavily traded pairing for the Aussie and any large movement on the USD can ‘weigh’ the Australian dollar down against other currencies.

Later this week we have the latest US-China trade war talks which could be a market mover in the future, clients with any AUD transfers should be keeping a very close eye on the latest news. The meeting this week might yield too much news since there is still a 1st March deadline for the talks to be finalised.

Finally, Friday is the latest US Non-Farm payroll data which might well trigger volatility on the Australian dollar, by altering global attitudes to risk and viewpoints on global trade. Clients looking to buy or sell the AUD should be very conscious of these developments which should see a very busy end to the week for the Australian dollar.

If you have a position buying or selling and wish to get a fresh update o the market and all the important issues driving your levels, please do get in touch to discuss the latest news with me Jonathan Watson.

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

Jonathan Watson

jmw@currencies.co.uk

Will next week’s vote on May’s Brexit deal cause movement for GBP/AUD?

The Pound has been trading within relatively thin volumes this week against most major currency pairs as the currency comes under pressure in the lead up to next week. On the 15th of this month, which is next Tuesday there will be a ‘meaningful vote’ on Prime Minister, Theresa May’s Brexit plan and much of the speculation this week revolves around that date.

The Australian Dollar, despite being the biggest loser in terms of currency throughout 2018 of the G10 countries, has actually been increasing in value over the past week as hopes of a agreement between the US and China over the trade war talks increase. There have been ongoing discussions recently between the two leading economies, and this is a positive for Australia as China is the country’s main trading partner.

So far this morning the Pound has got off to a poor start, as pressure builds in the lead up to next week’s vote, especially after the first planned vote was delayed as May was concerned of a major loss. The latest Brexit related update is that yesterday evening Parliament voted in a new amendment specifying that the government has 3-days to report back to the commons with its ‘plan B’ in the event that May loses next week.

Economic data is taking a back seat at the moment owing to the importance of UK politics at the moment, but it’s worth being aware that on Friday there will be UK GDP figures released at 9.30am with growth of 0.1% expected. I would expect to see a drop in the Pounds value if this figure disappointing especially if the figure shows a negative figure.

If you wish to be updated and to plan around what could be a busy week for the GBP/AUD pair, do feel free to register your interest with us.

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.