Tag Archives: GBP AUD

Australian Dollar Rockets after RBA Meeting (James Lovick)

The Australian dollar has made substantial gains overnight following the meeting by the Reserve Bank of Australia last night. The central bank held rates at 1.5% as widely expected however the commentary was slightly more hawkish which has led the markets to believe that there could be an interest rate hike down under in the early part of 2018. The markets had been expecting the first hike sometime in late 2018 and so this change in expectations is helping to strengthen the Aussie.

GBP AUD – Brexit Volatility

Clients looking to buy Australian dollars with pounds have seen a good couple of weeks with some of the best levels available for a year. The more upbeat mood in Britain in terms of the Brexit negotiations has helped the pound rally over these last two weeks although GBP AUD hit a major roadblock in afternoon trading yesterday.

The expected deal between Britain and the EU which focussed on the thorny issue of the Irish border was abandoned yesterday afternoon after the Democratic Unionist Party scuppered the deal stating it was unwilling for Northern Ireland to have different terms to Britain when leaving the EU. The pound dropped against the Australian dollar immediately after the news and we may need to wait until the end of this week or next before new developments emerge.

If no deal can be hammered out then the pound is likely to drop in value quickly although the expectation is that there will be sufficient progress for Brexit talks to move onto trade before the end of next week.

Clients looking to buy or sell Australian dollars are likely to see major new direction in the rates over these next two weeks ahead of the key EU summit 14th & 15th December. Please get in touch to discuss how these event directly impact on the rates of exchange and how it affects your specific requirement. Please email me James at jll@currencies.co.uk

GBP AUD Finds Support at 1.75 (James Lovick)

GBP AUD Exchange rates are back up over 1.75 again for this pair creating a good opportunity for those clients looking to buy Australian dollars. The Aussie dollar has come under pressure of late for a number of reasons. The dovish commentary from the Reserve Bank of Australia means that although the next interest rate movement is more likely to be up rather than down the timing of a rate hike will probably not be until the end of 2018. The other factor putting pressure on the Aussie stems from what is happening in the US.

The US Fed are looking to raise interest rates in December although there have been renewed concerns over weak inflation and more importantly weak wage growth, something that has become an issue for many of the major economies. As interest rates in the US go up taking rates higher than what are currently available down under this has the effect of helping drive up the US dollar whilst weakening the Australian dollar. With the US looking to continue raising rates another 2-3 times in 2018 as things stand then the Australian dollar could find itself under considerable pressure in the New Year.

Clients looking to buy or sell Australian dollars should pay particular attention to the EU summit in the middle of December as this is where the pound should see new direction. Should the Brexit stalemate be overcome then the pound could rally materially although the risk remains of a no deal scenario.

UK banking stress test released this morning have highlighted the banks are strong enough to withstand a severe stress test scenario in a sign of strength for the banking sector. More importantly the Governor of the bank of England has said that bank will continue to support the economy in the event of a disorderly Brexit.

For more information on the Australian dollar and how these key upcoming events have a direct impact on the rates of exchange and how to maximise on the opportunities as they happen then feel free to get in touch with me James at jll@currencies.co.uk

Aussie Dollar Boosted on Comments from RBA (James Lovick)

The Australian dollar has found a small degree of support this week after Reserve Bank of Australia Governor Philip Lowe made clear that the next interest rate move is more likely to be up rather than down. The last minutes from the RBA signalled that there is unlikely to be any interest rate increase for a very long time so which actually helped see the Aussie weaken. Although the Governor’s comments don’t fundamentally change that much the markets can take it as reassurance that there is likely to be a rate rise possibly next year and this is giving the Aussie a small boost.

GBP AUD exchange rates could see an interesting day and rest of the week on the back of the budget that will be delivered by Chancellor of the Exchequer Philip Hammond today. The well broadcasted budget is likely to see considerable volatility for sterling exchange rates depending on how well it is received. Considering the Chancellor’s failed budget earlier this year he is unlikely to make any drastic changes and his hands are tied regardless as a result of Brexit uncertainty. As such GBP AUD rates are more likely to be impacted by the ongoing Brexit negotiations unless of course the Chancellor makes an epic mistake in which case his position would almost certainly be in jeopardy.

The Brexit negotiations remain deadlocked although a cabinet meeting on Monday evening seems to have unlocked more funds to be offered to Brussels with the condition being applied that the door must open to a future trade agreement. The caveat offered by the British government that nothing is agreed until all is agreed would suggest the UK could if necessary withdraw any offer of a financial settlement it makes and this will inevitable keep the pressure on sterling for the foreseeable future

At the next EU summit the EU leaders will decide if talks will move forward to trade and this is where there is likely to be substantial movement for clients looking to buy or sell Australian dollars with pounds. The summit around the 15th December in my view should see new direction for GBP AUD. Clients with pending requirements would be wise to get in touch at this stage in the run up this event to look at the options available to take the risk out of the market place and top try and maximise on any substantial changes in exchange rates. Feel free to email me James at jll@currencies.co.uk

GBP AUD Rates Slide on UK Brexit Uncertainty (James Lovick)

GBP AUD exchange rates have inched lower this week as ongoing British politics continue to weigh heavy on the pound. Clients looking to buy or sell Australian dollars would be wise to look at their options very quickly as developments over the next two weeks are likely to have a very big impact on the value of sterling rates.

UK Prime Minster Theresa May and the British government are feeling the pressure this week as it has been reported that forty conservative members are prepared to sign a letter of no confidence in the Prime Minister. It would only take another 8 signatures that would force a leadership challenge and this perceived risk of a potential change of leadership is piling on the uncertainty for the pound.

The recent ultimatum from the EU giving Britain just two weeks to cough up more money in the Brexit negotiations or face a no deal situation is yet another major concern for those clients holding pounds looking to buy Australian dollars.

Any deterioration in these negotiations will likely see the pound weaken further and sterling will very much depend on progress in the next couple of weeks. If for example there is no agreement on the divorce settlement and talks break down with no deal at all then in the short term the pound could come under sizeable pressure. This is a real risk and there is every chance that this least preferred option could become a reality for all sides involved.

Consumer confidence numbers from Westpac are released later which should give some clues as to the strength of the Australian consumer. Wage price data is released on Wednesday which could help see the dollar rally if the numbers arrive better than expected. The lack of action from the Reserve Bank of Australia though is only likely to prevent the dollar from strengthening too much. The decision to maintain rates at such low levels is keeping the dollar on the back foot.

Anyone selling Australian dollars could see some excellent opportunities in the next 10 days if Brexit starts to look messy which could provide a short window of opportunity. Please feel free to contact myself James at jll@currencies.co.uk and I will be happy to take a look at your requirement and see how your transfer may be impacted by these economic and political changes.

Australian Dollar Finds Support on Stronger Commodity Prices (James Lovick)

The Australian dollar could see a renewed boost in its fortunes with the rising price of commodity prices to include oil and iron ore. Climbing commodity prices are normally a good signal that the global economy is functioning well which bodes well for currencies like the Aussie dollar. Australia of course has a large export market for raw materials and is the reason it is referred to as a commodity currency. As such when the price of iron moves higher as it has done in the last three months then this is welcome news for the Australian dollar. Any further increases in commodity currencies in these coming months should only help support the dollar further.

The Australian dollar had come into a little bit of trouble of late with some sizeable losses seen after the Reserve Bank of Australia made clear that it is not even considering any interest rate increases at this time. Rates for GBP AUD moved into much more attractive territory for those clients looking to buy Australian dollars although those gains are now being brought back down after the recent rally in commodity prices.

The pound appears to have found support above 1.70 for the moment and any changes to commodity prices are likely to see the dollar react.
For those clients buying or selling Australian dollars for sterling would be wise to pay close attention to the next round of Brexit discussion which will resume tomorrow in Brussels.

The perceived stalemate is likely to keep pressure on the price of sterling and movement round this impasse is not expected until December of even January. As such clients looking to buy Australian dollars in the short term are unlikely to see rate much higher than the levels currently available. Once again the Brexit negotiation will continue to be the single biggest driver for sterling exchange rates in these unpredictable markets.

Should you have a currency requirement and need to either buy or sell Australian dollars for pounds or Euros for example then please do get in touch with me and I will be happy to look at your requirement and see how we may be able to assist. We are able to achieve excellent commercial rates of exchange from the live markets but we can also help you with the timing of the conversion and look to help you find a good day to do the trade. You can email me directly at jll@currencies.co.uk

GBP AUD Breaks over 1.73 ahead of Bank of England Meeting (James Lovick)

GBP AUD exchange rates have seen an excellent boost with rates breaking over 1.73 for this pair today. There is currently an excellent opportunity for those clients looking to buy Australian dollars as present. The Australian dollar has come under pressure in recent weeks following the very dovish set of minutes from the Reserve Bank of Australia (RBA).

It is now very unlikely that there will be an interest rate increase any time soon. The earliest rate increase is likely to be some time at the end of 2018 or possibly even into 2019 which is helping see the Aussie weaken. Despite the strength of the Australian economy and bearing in mind that it has been over 25 years since the last recession down under the Australian dollar is seeing some weakness at present and this stems from the tone coming out of the RBA. It is well known that the RBA has raised concerns over the recent strength of the Aussie and has openly made clear its view that it would like to see the currency weaken and this appears to be filtering through into the exchange rate.

As far as GBP AUD is concerned the pound has also received a boost in the last week. The stronger Gross Domestic Product (GDP) numbers have helped lift sterling in what has been a very uncertain 16 months following the Brexit vote in June 2016. The Bank of England meet on Thursday and there is a strong chance that there will be a hike by 0.25% taking levels back up to 0.5%. Clients looking to buy Australian dollars with sterling may wish to consider locking in at the current better levels. There is a risk that if the central bank does not rise rates on Thursday then the pound could fall lower.

If you would like further information on Australian dollar exchange rates or any of the major currencies and to discuss how we can assist then please feel free to contact me on 0044 1494 787 478 and ask one of the team for James. Alternatively, I can be emailed directly on jll@currencies.co.uk

Selling Australian Dollars – Dollar Resilient after Weaker US Inflation

The Australian dollar has been performing slightly better of late after a disappointing inflation report from the US which could persuade the US Fed to pause on the rate increase cycle where a hike has been widely expected this December.

Those clients looking to convert Euros into Australian dollars are seeing levels sitting just off a one year high for this pair. The recent economic improvement in the Eurozone with steady economic growth and higher inflation has helped see a strong rally for Euro exchange rates over the last six months. There is a strong chance the European Central Bank will look to taper its asset purchasing scheme at the next meeting and this should help the Euro strengthen further. EUR AUD is currently sitting at 1.50 for this pair and there may be some more room in this rally. For anyone selling Euros for Australian dollars there could be some better opportunities to come so please get in touch for assistance with the timing of your future exchange.

The pound has fallen against the Australian dollar in afternoon trade today as Brexit uncertainty continues to be the main driver for sterling Australian dollar exchange rates. GBP AUD slipped to a low of 1.6793 earlier today moving well away from the 1.70 barrier. Despite UK inflation hitting 3% earlier today the markets are still not fully convinced that there will be an interest rate increase at the November meeting. This uncertainty is keeping additional pressure on the pound although my view is that the Bank will look to raise interest rates at the November meeting.

Comments from Mark Carney today were also very hawkish in that he said he expected inflation to rise even further. A rate increase by 0.25% in November seems the logical step for me and the pound should rally by a small degree on the back of it. Clients buying Australian dollars might be wise to see the outcome

If you would like further information on Australian dollar exchange rates or any of the major currencies and to discuss how we can assist then please feel free to contact me on 0044 1494 787 478 and ask one of the team for James. Alternatively, I can be emailed directly on jll@currencies.co.uk

GBP AUD Exchange Rates Uncertain as Brexit Falters (James Lovick)

GBP AUD is being driven this week by developments in the Brexit negotiations which went into the fifth round of the negotiations this week. The pound has seen a hugely volatile few weeks after the change of stance from the Bank of England where an interest rate is expected in the coming months and the growing uncertainty over Brexit.

There is a 50% chance that the Bank of England will raise interest rates at the November meeting whilst the markets have fully priced in a rate hike by February 2018. A rate hike would be good news for sterling Australian dollar exchange rates but the uncertainly of Brexit is likely to keep the pound under pressure.

Those clients looking to buy Australian dollars with pound would be wise to consider all options as in these markets anything can happen very quickly. The stalemate with Brexit negotiations is something to be very aware of as any speeches from the Prime Minister or other EU leaders can have a direct impact on rates.

Those clients with looking to buy or sell Euros with Australian dollars could see an interesting few days after the Catalonia outcome expected very shortly.

Westpac consumer confidence down under is released overnight and can be seen as a good barometer on the state of the Australian economy and how resilient consumers are. The Reserve Bank of Australia have raised concerns over the strength of the Australian dollar so it may be a matter of time before the conversation moves towards additional stimulus or at least talk of a possible interest rate decrease. This is widely regarded as jawboning and can see the dollar react very quickly.

If you would like further information on sterling or Australian dollar exchange rates or any of the major currencies and to discuss how we can assist then please feel free to contact me on 0044 1494 787 478 and ask one of the team for James. Alternatively, I can be emailed directly on jll@currencies.co.uk

GBP AUD Under Pressure as Brexit Tensions Escalate Further (James Lovick)

The Reserve Bank of Australia (RBA) held interest rates last night as widely expected at 1.5%. The general feeling is that rates will not change until 2018 at the earliest but is important to highlight that there is a growing concern over the strength of the Australian dollar. A strong dollar is bad for Australia’s exports and the RBA has been known to jawbone the currency by making statements surrounding monetary policy that have the effect of moving the currency without the central bank actually having to take specific action. Looking forward we are likely to see such arm twisting from the RBA and the Australian dollar could see some weakness in the coming months.

GBP AUD exchange rates could also see a sizeable boost if Britain and the EU can get to a point of “sufficient progress” with the EU. As things stand the pound remains in a very weak position with all the uncertainty that surrounds Brexit. Any signs that there will be a future trading agreement should see the pound make considerable gains although we are not at this stage yet.

This week Jean Claude Juncker and Michel Barnier have both highlighted that more needs to be done. Expect more mileage from Brexit and there could be some good opportunities in the coming weeks for buyers and sellers alike. Clients looking to sell Australian dollars could see a small window of opportunity if tensions rise.

Australian retail sales numbers and trade balance data are released on Thursday and could create some volatility for the Aussie dollar. Data on Thursday focussing on the construction sector will also be keenly viewed as it may give some clues as to where the sector is heading. There have been ongoing concerns over Australia’s buoyant property market and it is expected to only be a matter of time before a wobble is seen at the top.

It is traditionally the construction and housing markets which are the first to fall ahead of a downturn. Whilst we may not be there yet any signs of a slowdown starting to happen down under could see the dollar weaken.

If you would like further information on sterling or Australian dollar exchange rates or any of the major currencies and to discuss how we can assist then please feel free to contact me on 0044 1494 787 478 and ask one of the team for James. Alternatively, I can be emailed directly on jll@currencies.co.uk

GBP AUD Finds Support at 1.70 (James Lovick)

The pound remains on a stronger footing against the Australian dollar this afternoon after all the recent political developments. The Australian dollar has come under some pressure after the elections in New Zealand and Germany have created ongoing uncertainty for the Aussie. The hung parliament which has come about in New Zealand could take weeks before a coalition government is formed.

Meanwhile in Germany it could take 2-3 months before a government is formed which is also seeing some investor caution which doesn’t bode so well for the Australian dollar. However in the case of Germany it will come about that Angela Merkel will serve her fourth term as Chancellor and so when confidence is restored this should help strengthen the Aussie.

Clients looking to buy Australian dollars with pounds are seeing a good opportunity to purchase although the pound did see a wobble on Friday after the eagerly anticipated Theresa May speech in Florence did not lift the pound. Brexit negotiations were kick started yesterday and any developments here are likely to direct GBP AUD exchange rates. Any positive noises from Brexit secretary David Davis or his counterpart Michel Barnier could help see the pound move higher especially if the door to discussing a future trade deal between the UK and EU is opened. For the moment levels have broken back over 1.70 for GBP AUD presenting good levels for dollar buyers.

Economic data down under is quiet this week and focus is likely to move to the escalation of tensions between the US and North Korea. The Australian dollar is perceived as a riskier currency so any further escalation between the two could see the dollar come under added pressure. Those clients looking to sell Australian dollars should be aware of the situation as any deterioration could see the Aussie fall sharply lower.

If you would like further information on sterling or Australian dollar exchange rates or any of the major currencies and to discuss how we can assist then please feel free to contact me on 0044 1494 787 478 and ask one of the team for James. Alternatively, I can be emailed directly on jll@currencies.co.uk