Tag Archives: buying australian dollars

US/China Trade War and Brexit dictate GBP/AUD (Daniel Johnson)

Progress in US/China talks

Due to Australia’s heavy reliance on China purchasing its goods and services any fall in growth from China has an impact on the Australian economy and in turn the Australian Dollar.

The US/China trade war is a huge concern amongst investors, a trade war between the world’s two largest economies has huge implications. The Trump administration wants China to change its economic strategy, something Chinese President,  Xi Jinping will be reluctant to do. The changes that are being asked for would hit the Chinese economy hard and  long term. It may be the case that the Chinese will try and give very small concessions in  bid to lengthen the trade war and out last Trumps reign. A dangerous game considering the US has threatened to increase tariffs to 25% should their terms not be met. 25% is a huge increase and if China retaliate both economies will suffer not to mention the global impact.

At present, trade talks seem to be progressing well.  When asked about how talks were going yesterday in Beijing, US Treasury Secretary , Steven Mnuchin replied “so far so good.”

If it were not for the lack of clarity surrounding Brexit I think Sterling would be making gains against the Aussie. Although, the pound could lose value as negotiations with Brussels intensify I think the likely outcomes are either an 11th hour deal or an extension, both of which could cause significant Sterling strength. Morgan Stanley recently suggested there was less than a 5% chance of a no deal scenario. The market moves on rumour as well as fact so due to a no deal Brexit being largely factored out of the equation at present, if it were to occur expect  a large drop in the pound as this outcome is definitely going against the grain.

If you have a currency requirement I will be happy to assist. If you let me know the details of your trade I will endeavour 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 18yrs and FCA registered.If you would like my help feel free to email me at dcj@currencies.co.uk.

Pound remains strong against the Australian Dollar even after poor UK GDP figures

The Australian Dollar has continued to struggle against the Pound hitting 1.82 during today’s trading session creating some good opportunities for anyone looking to convert Pounds to Euros at the moment.

The Reserve Bank of Australia was relatively dovish during its recent press conference and accompanying statement and it appears as though the next rate change for the central bank down under could be a rate cut in the future.

One of the reasons why the RBA has yet to make a change to interest rates is owing to the recent higher than expected inflation data, which although lower than the 2-3% target has been rising recently.

Typically if inflation rises then the usual strategy to combat this would be to increase interest rates but as the property market in Australia is showing real signs of slowing down then an interest rate rise down under could cause big problems for the Australian housing market and could send home owners in to negative equity.

According to many sources an interest rate cut before the end of 2019 now seems like a certainty and this is part of the reason why the Pound continues to remain relatively strong against the Australian Dollar.

Whilst the Trade Wars between the US and China continue to rumble on then global investment appears to be bypassing the Australian Dollar in favour of the US Dollar and this is another reason for the continued weakness of the AUD vs the Pound.

Earlier on today UK GDP showed a slowdown for the final quarter of 2018 combined with some lower than expected Industrial and Manufacturing Production data but this did little to negatively impact Sterling as the market appears to be waiting to see how the Brexit talks will progress during the course of this week.

I have worked for one of the UK’s leading currency brokers since 2003 and I’m confident that not only can I help you save money on exchange rates compared to using your own bank but also help you with the timing of your currency transfer. For a free quote then contact me directly via email with a brief description of your currency requirement and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

 

Australian dollar mildy firmer after RBA Meeting!

The Australian dollar has been mildy firmer after the RBA, Reserve Bank of Australia, kept their interest rates on hold overnight. The expectations for the RBA is to have moved their outlook to a slightly more dovish tone but overall they kept up their current viewpoint, which is essentially that they will keep interest rates on hold for now.

The RBA did cite increased global risks, which could lead to a lower economic outlook in the future. This might well prove indicative for future Australian dollar weakness, there is now increased expectations that the longer term future for the Australian currency remains subdued. However, for now, as the RBA are not directly forecasting a rate cut, the market is likely to err on the side of caution.

In other news overnight the latest Australian Retail Sales figures weighed slightly on the market, coming in slightly worse than expected. This could be another sign of what the future might hold and be an indicator that the Australian dollar might in the future be struggling.

Some of the downside risks for the currency include global events such as the Trade Wars with China, and also recession in Italy. With the IMF recently having downgraded global growth, we could see the Australian currency lose value longer term if global confidence does not improve.

I expect the Australian dollar to weaken longer term and think clients looking to sell the currency would be better to move sooner than later, to avoid the risk of any losses. The Australian currency is effectively a barometer of sentiments on global trade and with those sentiments likely to suffer further, it seems likely the currency will fall in the future.

Next week is a series of Australian releases, including Home Loans and also some Chinese data. With Chinese economic news weighing on the economic outlook for the region, clients with Australian dollars to sell might wish to take advantage of the more recent improvements and lock in their gains.

Thank you for reading and please let me know if you have a transfer that we might be able to help out with, or you wish to discuss.

Jonathan Watson

jmw@currencies.co.uk

 

Pound sees signs of a struggle against the Australian Dollar after Brexit discussions

The Pound has started to fall during the course of this week against the Australian Dollar as the Brexit talks appear to be struggling to make too much headway.

The recent amendment about the Irish backstop was voted through the House of Commons, which means that Theresa May will try to go back to the European Union in an effort to change the current terms of the backstop.

However, all throughout yesterday European leaders confirmed that the current Brexit deal on offer will not be renegotiated and this moves us towards the chances of even having a no deal Brexit.

Overnight, the Australian Dollar had a boost after the announcement made by the US Federal Reserve that they will be keeping interest rates on hold.

The statement made by Jerome Powell suggested that the Fed would not simply look at economic data but also listen to businesses and this means that the cycle of rate hikes may not be as quick as many had previously anticipated. Clearly, there is room for further interest rate hikes to occur in 2019 in the US but the statement from last night means that they may be slowing down their cycle.

The good news for the Australian Dollar is that global investors will move money away from the US and back into more riskier currencies including the Australian Dollar and this is in part a reason for the strength overnight.

I have worked for one of the UK’s leading currency brokers for 16 years and I’m confident that with my experience I can help you with the timing of your currency transfer.

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

Tom Holian teh@currencies.co.uk

Sterling climbs as May’s Brexit deal is emphatically rejected

It’s been a volatile 24-hours for the GBP/AUD exchange rate, as the Brexit talks ramp up and the UK parliament decides how best in carry out the Brexit.

Late yesterday evening the UK Prime Minister, Theresa May’s Brexit deal was overwhelmingly voted against by Parliament. The amount of votes she lost by was in the top-end of expectations, as she lost by 230 votes with was a much larger number than many analysts had expected.

Since then, the leader of the opposition (Jeremy Corbyn of Labour) has called a ‘vote of no-confidence’ in the government which will take place this evening. May is expected to win as no members of her own government have announced that they will vote against her and the DUP Party of Northern Ireland has also offered their support.

Tonight’s vote at 7pm is the next step in the Brexit process that could impact the Pound’s value, but what happens next is now quite unclear. The existing government has 3-days to announce their plan-b which could also be a market mover, so if you wish to be updated in the event of a major market movement do feel free to register your interest.

The Aussie Dollar, like the stock markets in the region remain under pressure whilst we wait for more clarity on global growth and trade war concerns between China and the US. The GBP has regained a lot of ground against AUD recently and last nights vote has helped. The pair are currently trading in the 1.79’s so it will be interesting to see whether the pair will manage to break through the psychological 1.80 level.

Moving forward I expect to see the pair continue to be driven by Brexit related updates, although early tomorrow morning there will be a number of releases from Australia concerning new home sales and inflation data.

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.

Will the Australian dollar weaken in 2019?

The Australian dollar is likely to weaken in 2019 as the concerns over Trade Wars intensify amongst investors. There is a growing concern that in the future the market will be more uncertain and the Australian dollar, as a commodity currency is likely to be weaker in the future. Clients with a position buying or selling the Australian currency should be strapping themselves in for a volatile period as the market tries to second guess what lies ahead.

In nearly every forecast for the year ahead I have read, the AUD is noted to come off worse from a worsening Trade Wars situation under Donald Trump, showing no signs of backing down and seeking to challenge China’s economic plans. Clients with a position buying or selling the Australian dollar will have a tough time in the future to try and second guess the market but as the Aussie dollar reflects global attitudes on trade, the likelihood is that the currency will weaken.

Clients who need to make an exchange should note not just the changing global attitudes on trade but also the negative political and economic effects at home in Australian too. Whilst the market had been pricing in for an interest rate hike in the future, some are now suggesting that the RBA, Reserve Bank of Australian will in fact be forced to look at an interest rate cut instead. This could send the AUD into a downward spiral as investors look for more comfortable and stable stores of value.

2019 is shaping up to be a more uncertain time on the currency markets as investors struggle to make sense of the changing global economy that lies ahead. Investors will struggle to find the Australian dollar an attractive currency to hold, particularly when the US dollar is now offering a higher return with a higher rates of interest on offer.

If you have a transfer to make and wish to consider the latest news and trends which will move the market, please do not hesitate to get in touch to discuss further.

Jonathan Watson

jmw@currencies.co.uk

The Pound hits a 6 week high against the Australian Dollar owing to Australian housing market problems

The Pound vs the Australian Dollar has hit a 6 week high which is good news for anyone looking to send money to Australia.

The spike has occurred in part due to the tightening lending standards in Australia which has caused a problem for the Australian housing market and this has seen house prices fall in recent times.

This is a big reason for the Reserve Bank of Australia keeping interest rates on hold and with the US Federal Reserve recently raising interest rates for the final time this year global investors have been selling off the riskier based commodity currencies including the Australian Dollar, New Zealand Dollar and South African Rand in favour of a more stable US Dollar.

The mortgage companies as well as the banks have been previously lending to people without clearly identifying whether or not they would be able to afford to pay back the loans and this means that Australian banks are now paying the price for the previous problems.

In Perth, which is one of Australia’s largest cities, house prices have fallen by over 15% in the last four years and Sydney and Melbourne have also started to see a small slowdown and this means any interest rate hike down under in unlikely to be coming any time soon as this would have a direct impact of the Australian property market.

With the Reserve Bank of Australia due to be keeping interest rates on hold for the foreseeable future and the US Federal Reserve likely to keep on raising rates in the early part of 2019 I think we are due to see further Australian Dollar weakness ahead so if you’re looking to exchange Australian Dollars into Sterling it may be worth getting this organised in the near future.

The one problem that could halt Sterling in its tracks is that of the ongoing Brexit turmoil which could cause a problem for Sterling.

With the next Brexit vote due to be held in the second week of January this could cause further volatility so make sure you’re well prepared for any eventuality.

Having worked in the foreign exchange industry for one of the UK’s leading currency brokers since 2003 I am confident not only of being able to save you money on exchange rates compared to using your own bank but also help you with the timing of your transfer.

For further information and a free quote then contact me directly and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

GBP/AUD continues to trade towards the lower end of its recent ranges, where to next for the pair and what’s influencing it?

The Pound to Australian Dollar rate continues to trade in the mid 1.70’s just over 1.75, which is around the bottom of its current trend when you look at both a 3-month and a 6-month chart. There has been a steep decline in the Pound’s value from around the middle of October and much of this market movement can be attributed to Sterling weakness as the Brexit uncertainties ramp up with the Brexit date just around the corner now.

Yesterday it was announced that the ‘meaningful’ vote on UK Prime Minister Theresa May’s Brexit deal will take place. It has previously been outlined for last Tuesday but she postponed it the day before owing to fears that she would receive very little support for it. May has since won a vote of no-confidence although there were around of a 3rd of her Conservative Party MP’s that voted against her leadership which shows the discontent with her deal.

The Pound has also lost value against most other major currency pairs recently as time to agree on a deal is running out. There appears to be little scope for amendments to the deal which may be the Prime Ministers downfall as the Northern Irish backstop arrangement is the main sticking point for the deal and the reason for the DUP Party not supporting the deal which has added pressure to May and also the Pound’s value.

Although economic data is not the main driver of GBP’s value at the moment, it’s worth being aware that this Thursday there will be a Bank of England Interest Rate decision and although no changes are expected, any comments to future monetary policy plans could influence the Pound’s value.

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.

Pound to Australian Dollar Forecast and the impact of the Brexit deal

After hitting above 1.80 earlier this month the rate to buy Australian Dollars with Pounds has fallen in to the 1.75 levels on the Interbank.

Primarily this was caused by the huge losses in the value of the Pound against a number of major currencies owing to the issues surrounding the proposed Brexit deal.

However, it was not just the news in the UK that caused the Pound to fall against the Australian Dollar.

During the course of this week the economy down under showed an improvement in the unemployment rate which fell to 5% and this caused investors to move money in to the AUD as it shows signs of a more positive economy.

The main news that caused the drop in the value of the Pound was the proposed Brexit deal. This caused a number of senior ministers to hand in their resignations including Brexit secretary Dominic Raab. He left citing differences in the deal and that he could not be part of the government owing to certain issues in the proposed deal which he could not agree upon.

Could the Brexit deal be changed?

Meanwhile this weekend a number of senior ministers in the Conservatives are planning to try and make changes to the draft Brexit deal.

Included in the group are Michael Gove and Liam Fox who have previously thrown their support behind Theresa May.

The Prime Minister has been busy trying to persuade the British public that she is determined to see this deal through.

The next stumbling block could come on 25th November when the EU summit takes place. The likelihood is that this is likely to get ratified but the real sticking point will come when the parliament has its say.

The current expectation is that the EU will approve the deal but that parliament will reject it and then the UK government will have 21 days to put forward a new plan and I think this will will increase the pressure on the value of the Pound.

Therefore, if you’re planning to buy Australian Dollars in the near future it may be worth getting this organised relatively quickly.

If you are thinking about making a currency transfer and would like to save money when transferring Australian Dollars then contact me directly for a free quote and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

 

 

GBP/AUD drops after May’s Brexit deal looks unlikely to get the support she needs

The Pound is down across the board of major currency pairs today, in most cases by over 1% at least with the GBP/AUD rate down by over 1.6% at the time of writing. Yesterday the Pound was increasing in value on hopes of May’s cabinet supporting her deal, but this morning the situation is very different with Sterling under increasing pressure.

This morning its emerged that Dominic Raab, the Brexit secretary that took over from David Davis after he resigned, has this morning resigned himself stating that he ‘cannot in good conscience support the terms proposed for our deal with the EU’. This has put further pressure on Sterling with money markets now suggesting the chances of another interest rate hike from the Bank of England has now lowered.

Whether the Aussie Dollar will continue to climb against the Pound this morning will depend on whether there are further resignations from her cabinet, and also whether May can pass her Brexit deal through Parliament. The rumour mill suggests she will need to gain the support of of more than 50 hardcore Tory Brexiteers and Labour rebels. Donald Tusk has also hinted at concerns May could lose her position which would scupper the plans agreed over the past week.

Some key figures from within the hardcore Brexit movement have already announced their disapproval, and I think there could be further resignations based of the knee jerk reaction to her proposals.

Economic data is likely to take a back seat regarding GBP exchange rates at the moment, with Brexit remaining the main driver of currency value. If you wish to be updated in the event of a major market movement do feel free to register your interest.

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.