Tag Archives: EURAUD
Should the RBA cut interest rates next week I would expect GBP/AUD to move towards 1.52 but EUR/AUD could move back to 1.25
Sterling has once again breached the 1.50 level against the Australian Dollar creating some good opportunities for those looking to buy AUD. We have also seen the Euro rally past 1.27 back from the mid 1.25s earlier this week. For me we are likely to see further opportunities for GBP/AUD, particularly should the Reserve Bank of Australia look to cut interest rates on Tuesday next week. As for EUR/AUD the recent gains could be a stronger opportunity. The European Central Bank will meet tomorrow to discuss their latest interest rate decision with many expect the ECB to cut rates from 0.75% to 0.5%. This will have been priced into the market but I would still expect moves against the Euro to be negative as we finish off the trading week.
Longer term I believe buyers of the Australian Dollar will get stronger opportunities and would expect a shift towards 1.52 for GBP/AUD and would certainly adopt a wait and see approach. I feel the slowing economy in China and the recent strength of the dollar will cause concern for the RBA and I would not be surprised to see a couple of interest rate cuts throughout the year, with opportunities towards 1.55 later this year.
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The Australian Dollar has posted strong gains against the pound today rallying nearly 0.5% but has held steady against the single currency. This week is relatively quiet for the Aussie with the most notable data set being on Thursday with employment change figures. Figures will give clues as to the current performance of the Australian economy and could throw up some surprises for the dollar throughout the course of Thursday’s trading. Elsewhere data sets for the beginning of the week are dominated by European and UK data tomorrow with German GDP data and European trade balance figures followed by UK Inflation and Retail sales figures. Those looking at buying AUD with GBP should also keep an eye on a speech from the Governor of the Bank of England Mervyn King. King is scheduled to speak at 10:00 and historically can be overly cautious about the UK’s prospects, this could keep pressure on the pound and I see rates hovering around 1.5150-1.52.
EUR/AUD exchange rates have been relatively stable over the course of the last three months, reaching a high of 1.28 and a low of 1.22, the average trade price sitting in the region of 1.25/26. Current market levels are at 1.2652 and I personally see little change for this pairing in the coming weeks and would expect a range between 1.25/27.
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During the Autumn statement Osborne came under huge pressure as debt burdens continue to mount and UK growth forecasts have been cut. credit ratings agency Fitch has said that the UK failure to meet its debt targets have put the UK’s AAA credit rating at risk. Indeed, a cut to the rating could mean that the country is seen as more risky to lend money and therefore borrowing costs could rise causing further problems as we enter 2013. The Office for Budget Responsibility announced that the UK will miss its debt target of and the economy will contract by 0.1% this year, a massive difference compared to their prediction made in March when it claimed the economy would grow by 0.8% this year.Growth forecasts have been cut for the next 5 years so all in all the statement has been seen by the general economy as negative.
Tomorrow we see the release of both the UK interest rate decision and the ECB rate decision so any change could see a movement for GBPAUD and EURAUD exchange rates. For up to date exchange rate information feel free to contact me directly via email Tom Holian firstname.lastname@example.org
As many analysts expected the Reserve Bank of Australia cut the base rate by 0.25% overnight bringing levels to 3.25%. Following this announcement the Australian dollar has fallen in value against the Euro and Pound by over 1 cent. Buying levels for the Aussie are now at a 4 month high for GBP/AUD, having gained over 6% since the lows of August and showing a very similar trend for EUR/AUD with he dollar having lost 8% since August. These are substantial gains and buyers of the Australian dollar may do well to take stock and look at taking advantage.
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Over the course of the weekend we have seen continued strength from the Australian dollar, will this continue? This morning the pound is again losing ground against the Aussie, however the pound is down across the board so this would appear to be Sterling weakness rather than a continuation of strength form the Australian Dollar. The pound could be in for a rocky week in the run up to GDP estimates from the NIESR (National Institute for Economic and Social Research) a well regarded think tank. Figures are often relatively accurate and will therefore be viewed closely. Should the figures continue to show a negative etrend then we could see further moves towards 1.47 – just 1 cent of the record levels seen in February this year and creating some fanatastic sell opportunities for anyone holding Australian dollars. Also this week for anyone looking at GBP/AUD we have the Bank of England inflation report on Wednesday at 10.30 – keep an eye on this foany clues as to future Montary policy from the Bank of England.
Prior to this anyone with an interest in teh Aussie should keep an eyo the Reserve Bank fo Australia interest rate decision overnight. We are expecting to see rates on hold at 3.5% but any announcements from the Reserve Bank may cause short term swings, however I would still expect the Australian dollar to continue to see positive movements ands can see 1.47 on GBP/AUD and EUR/AUD down towards 1.16 – although I do feel the Aussie is beginning to reach its peak and any AUD sellers should sseriously consider taking advanatage.
As a specialist curreny broker the aim of this blog is to help private and corporate clients make the most of their currency exchange. When moving large sums of money it is highly important to have access to best prices, though using the services of a specialist broker it enables you to keep up todate with current market trends and data sets that may affect yoru exchange. It is not uncommon to see the amrket move well in excess of 1% in a day and timing yoru exchange can make a very big diffeerence to the amount of currency your receive. Here at currencies.co.uk we have a number of contracts available to maxmise or guarantee yoru exchange, to discuss these in more detail and my opninons on the market then please email Mike at firstname.lastname@example.org or call on 01494 787478.
Following the news of the Greek bailout deal I firmly believe this may continue to support the strength of the so called ‘riskier’ assets such as the NZD, ZAR and AUD. The reason they are perceived as riskier currencies is the fact they are so heavily dependent on commodity prices and the AUD in particular heavily dependent on the mining sector and the demand from countries such as China for raw materials. With China hot on the heals of the US in becoming the worlds largest economy there is little sign of this demand for raw mat3erials from falling and I feel this is only going to lead to further strength for the AUD. There is the argument that the the Reserve Bank of Australia may intervene to artificially devalue the AUD as Australian exports are becoming less and less competitive, however I think this is unlikely. I do believe we will see an interest rate cut within the next few months but I believe the market is expecting this and it is unlikely to have a major impact on the value for the AUD. For this reason I see little movement other than continued strength in the short term and would expect a move towards 1.45 for GBP/AUD and 1.24 on EUR/AUD.
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GBPAUD has been rather stagnant this week at the kind of levels stated above. I feel this is because investors are keenly awaiting the outcome of the Greek debt talks and also possibly US Non-Farm Payroll data this afternoon.
As Michael stated yesterday the Aussie has climbed by nearly 8% since November touching an all time high against the pound. There has been a major return to percieved riskier assets in the last month. The last half of last year saw investors flee such assets which is why sterling comfortably broke 1.60 on the Aussie. The recent change in trends has seen the Aussie strengthen. Will these sentiments remain?
Some view Europe as a ticking time bomb and it is fair to say that some big shocks emanating from the Euro crisis will cause the Aussie to weaken. Conversely signs that it is being dealt with will cause the Aussie to strengthen. It is clear the rate will not just remain in the current levels seen above and will break free soon. Normally when a trend develops on the Aussie it isn’t just a couple of cents movement, it can be 3 or 4 cents as investors move large sums to take advantage or cut their losses.
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