Tag Archives: GBP AUD

Australian Dollar Holds Steady after Unemployment Data (James Lovick)

The Australian dollar is still seeing an uncertain period with so many factors globally influencing the exchange rate. Overnight has seen unemployment data released which has held firm at 5.5% as expected. The Reserve bank of Australia are paying close attention to the labour market at the moment and are keeping a very close eye on the amount of wage growth down under, something all the central banks are monitoring closely. When wage growth begins to rise it will be a reason for the RBA to raise interest rates although for the moment the figures are still sufficiently weak to make the case for no changes to interest rates.

The RBA minutes from the last meeting will be released next week and will reveal what the central banks thinking from the last meeting. Any suggestion that the RBA will look to raise rates this year and follow in the US Fed’s footsteps could see the Aussie gain although it is my understanding that they are more likely to monitor the situation in light of all the recent volatility in the financial markets. Those clients looking to sell Australian dollars hoping for a move back to 1.70 might have a good while longer to wait.

Clients looking to buy Australian dollars are seeing a good opportunity to buy although the recent rally in the price of sterling has slowed down in the last week with rates coming off the recent highs. The pound is likely to see a lot of volatility in the coming weeks coming from the political arena. There are a series of speeches to be made by British politicians within the British government which should offer more clues as to where Brexit will end up.

UK Prime Minister Theresa May will be in Germany tomorrow and she is likely to make a statement either on Friday or Saturday. If we go back to the Lancaster House speech back in 2017 the pound rallied by almost 2% following the speech and so it should not be underestimated how much the sterling markets could move if more detail over Brexit is offered.

To discuss your requirement and how these events are likely to impact on your own requirement then please get in touch with me at jll@currencies.co.uk

Where Next for the Australian Dollar – Stock Market Crash Impact (James Lovick)

The Australian dollar has seen a very volatile week with lots of events happening globally since Monday which have had a direct and considerable impact on the strength of the Aussie. The Australian dollar has come under pressure after $66 billion was wiped off Australian shares earlier in the week following a global sell off with considerable losses also seen in the US and UK stock markets.

The Australian dollar which is regarded as a commodity currency normally comes under pressure in times of global uncertainty and this happening again now. This new wave of uncertainty in the global economy could see further problems for the Australian dollar and the Aussie may have further to fall.

However the Reserve Bank of Australia may intervene before that happens and any signal from the central bank that it is keen to raise interest rates later this year could see the dollar bounce back. Clients looking to buy Australian dollars are seeing some excellent buying prices which have stemmed from the perceived extra global risk and there may be some more gains to be had in this rally. Any further shocks from the US are likely to result in further weakness for the Aussie.

GBP AUD

Rates for GBP AUD have seen a good week with levels for this pair now sitting at around 1.77. The Bank of England meet tomorrow to discuss interest rates and any change in policy could see movement for sterling exchange rates. The Bank of England Governor however is more likely to cause a market reaction on the back on any commentary on Brexit. The central bank is unlikely to make any changes to interest rates although any suggestion that there is likely to be a rate increase later this year should help support the pound.

Clients looking to buy or sell Australian dollars would be wise to get in touch to take advantage of any spikes in the market which si something we can help you with. Please feel free to get in touch with me at jll@currencies.co.uk

GBP AUD Hits Resistance at 1.75 (James Lovick)

The Australian dollar remains set for an uncertain and volatile 2018 which will be heavily dependent on interest rate policy from the Reserve Bank of Australia (RBA) and also the US Federal Reserve. For the moment the Australian dollar has been boosted on the back of a weaker US dollar with political uncertainty and the recent government shutdown. The underlying question is how keen the RBA will be to raise interest rates this year. If the US Fed hikes 2-3 times this year as forecast then the RBA will need to carefully decide how it follows.

As things stand there is an expectation that the RBA will seek to raise interest rates in June 2018 but if the difference in rates between the US and Australia widens too much then the Australian dollar could come under some selling pressure. For the moment the future outlook on interest rates is less clear which is likely to result in considerable volatility for the Aussie as more direction from the RBA is offered. The RBA are likely to favour a weaker currency to help its export markets so the central bank may be keen to take a more relaxed view on events in the US and not rush to tighten policy. The Aussie could see a gradual weakening as the US raise interest rates in the Spring.

The US debt ceiling is expected to be reached sometime in March 2018. This is likely to be a political animal and finding agreement to extend could prove difficult. The Aussie could see material gains around this period and so clients looking to sell Australian dollars may wish to try and find an opportunity around this period.

Australian inflation data is released tomorrow and will be keenly observed by the RBA. A higher number could help see the pound rally.

GBP AUD

Clients looking to buy Australian dollars with pounds have seen a good window of opportunity in the last week although the pound is struggling to climb much higher having broken through 1.75 last week. The mood on Brexit appears to be slightly more optimistic but even now in the second round of negotiations which commenced on Monday there is still much ambiguity. Discussion currently surround the so called transitional arrangement which so far appear less thorny.

However there could be complications and disagreement when it comes to the terms of the future trade agreement between Britain and the EU. Any souring of mood could see a sharp fall in the price of sterling and I would expect to see a number of drops in sterling as a direct result of these negotiations in the coming months. Buyers should be a particularly careful as it wouldn’t take much to see a sudden drop in the price of sterling.

To discuss your requirement and how to maximise on the rates of exchange as they become available please feel free to get in touch with me James at jll@curencies.co.uk

Will GBP AUD Break 1.80 (James Lovick)

The pound has seen an excellent week so far which has created a sudden opportunity for those looking to buy Australian dollars. Rates for GBP EUR peaked at 1.7719 today before slipping back in afternoon trade.

The pound has been given a boost this week as concerns over Brexit appear to have softened for the time being. French president Emmanuel Macron was in London at the start of the week and he signalled that Britain should have a bespoke trade agreement.
Even Ex-Prime Minister David Cameron was caught unware with a microphone saying that Brexit has “turned out less badly than we first thought”.

Clients looking for further gains could be hard pushed considering the changing tone coming from the Reserve Bank of Australia (RBA). The central bank is likely to follow in the footsteps of other global central banks and raise interest rates. Canada, the US and the UK all raised rates in 2017 and the markets are starting to prepare for a possible rate increase down under in June 2018.

The Australian dollar is extremely susceptible to the current events in the US and any deterioration in the political arena with more government shutdowns could weigh heavy on the US dollar whilst proving beneficial for the Aussie. As such the move to 1.80 could be a tall order for GBP AUD although any positive rhetoric from Brexit is likely to see a further boost for this pair.

In a quieter end to the week ahead of Australia Day tomorrow the markets will focus heavily on the official UK Gross Domestic product numbers. Although the expectation is for a drop in the numbers, something that has also been predicted by the International Monetary Fund, there are growing suggestions that there could in fact be a spike higher. A move higher to 1.8% for GDP in my view would help reinforce the push higher and could see another window of opportunity for buying dollars.

To discuss how these event impact on the currency markets and how we can assist with the timing of any transfers then please feel free to get in touch with me James and I will be happy to discuss. You can email me at jll@currencies.co.uk

GBP AUD Moves Higher Towards 1.75 (James Lovick)

The Australian dollar is reacting heavily to events in the US at present and the tone coming out of the US Fed is slowly starting to soften. The Aussie dollar is heavily impacted by the level that interest rates are set in the US and as rates rise in the US this should in theory put pressure on the Australian dollar.

The expectation was for three rate increase in the US throughout 2018 although that it may just be a case of a maximum of two and this is creating a bit of volatility for the Aussie. It was starting to look like the Reserve Bank of Australia may need to hike to accommodate such policy around the world but that first interest rate hike from the RBA may not be as forthcoming as the markets had expected and this is seeing the dollar weaken off.

GBP AUD has seen a small pickup in the rates with levels moving closer to 1.74 for the pair. A move higher to 1.75 looks like a realistic target for those looking to buy Australian dollars although the ongoing Brexit negotiations are also playing a role in where rates are heading.

Clients selling Australian dollars could see a return to 1.70 for AUD GBP on some strong economic data down under but the risk is that the ongoing Brexit negotiations could dictate the path of sterling. The Brexit discussion will soon move on the heated issue of future trade and the pound is likely to see considerable shocks as news is released. Anything positive from the UK and EU that there is likely to be a future trade deal is likely to see the pound rally further.

Australian unemployment data are released overnight and could create some volatility for the Aussie whilst Chinese GDP data could also impact on the rates due to Australia’s large export market to China.

To discuss how these event have a direct bearing on your currency requirement please feel free to get in touch with me at jll@currencies.co.uk and I will be happy to talk you through your options and help you with the transfer.

Australian Dollar Supported on RBA Interest Rate Outlook (James Lovick)

The Australian dollar continues to find support on a growing expectation that the Reserve Bank of Australia (RBA) will have to follow in the footsteps of other central banks and raise interest rates later this year. There is a view that the first rate hike could come as soon as June 2018 and this prospect in my view should help support the dollar. Those clients targeting a rate of 1.80 for GBP AUD may be disappointed although a more realistic level of 1.75 could still be manageable in the coming months on the condition that the pound is boosted on positive Brexit discussions.

Australian data and US data has been slightly mixed of late so it will be interesting to see business confidence figures tomorrow morning from National Australia Bank. Aussie retail sales numbers should also help paint the economic picture down under on Thursday.

Clients looking to buy or sell Australian dollars with pounds should pay close attention to political developments in the UK. The ongoing Brexit negotiations will continue to be a major driving force for GBP AUD throughout 2018. Discussions will now move on to the complicated issue of trade between Britain and the EU and any developments here are likely to see considerable volatility for the pound. Further progress which suggests that there will be a deal between Britain and the EU could see gains for the GBP AUD although the reverse is very true.

Any breakdown in talks is likely to see the pound weaken if it appears the prospect of a deal is moving away. There is currently a reshuffle taking place within Theresa May’s government with more changes expected later today. There are rumours that here may be a ministerial position for leaving the European Union without a deal. This highlights that it could be a rocky road ahead for sterling Australian dollar exchange rates.

To discuss how these events are likely to impact on your currency requirement and to discuss achieving the best rates then please feel free to contact me at jll@currencies.co.uk

GBP AUD Slides Lower as RBA Hints at Rate Rises in 2018 (James Lovick)

GBP AUD has fallen lower over this festive period with levels for the pair now sitting at 1.7245. The Aussie was given a boost in the run up to Christmas after the Reserve Bank of Australia (RBA) signalled that it was open to the idea of raising interest rates in the New Year. Clients looking to buy Australian dollars with sterling should pay particular attention to Brexit developments as discussion moves on to the thorny issue of trade.

The Australian dollar had come under pressure after the US raised interest rates in December which put both Australia and the US on a level playing field in terms of where rates are set at 1.5%. The US seeks to reach an equilibrium rate of around 2.5% and this is likely to have a damaging impact on the Aussie as funds move back to the higher yield in the US dollar.

The US has signalled that there is likely to be another two or three rate rises throughout 2018 and this is in theory should help strengthen the US dollar whilst weakening the Australian dollar. The change of stance coming from the RBA however is helping support the Australian dollar as those future interest rate expectations between the US and Australia appear to be more aligned.

As we move into the New Year expect to see a lot more mileage in the Australian dollar depending on events coming out of the US. In my opinion we are likely to see a much faster approach from the US to raising interest rates and this should put pressure on the Aussie. Any jawboning from the RBA however is likely to result in considerable market reaction.

As for GBP AUD expect considerable volatility from any ongoing Brexit developments. 2018 is likely to see major developments as the discussion moves on to the terms of trade. Clients looking to buy or sell Australian dollars can get in touch with me at jll@currencies.co.uk to discuss how these events will have a direct impact on any pending requirements you may have.

GBP AUD Rates ahead of Key EU Summit (James Lovick)

The Australian remains under considerable pressure as it has done for some time and this is unlikely to change shape any time soon. One of the big factors having a negative impact om the Aussie dollar is what is happening in the US. Where Australia had maintained some of the highest interest rates in the western world, the US is now looking to claim that spot.

The US is widely expected to raise interest rates at the US Fed meeting next week which will take rates up to 1.5%. Looking forward and rates are expected to climb higher with another two or three to be expected throughout 2018. The Reserve Bank of Australian on the other hand have made it clear there is no urgency to raise rates down under and will not follow other economies.

Interest rate rises can create strong improvements in a currency and the lack of action down under is helping to see the Aussie weaken as funds move out of Australia where the return on investment starts to become less.

GBP AUD

Those clients with a requirement to buy or sell Australian dollars should pay particular attention to the EU summit which starts tomorrow and concludes on Friday. This is a major event in the diary as it will confirm where or not sufficient progress has been made by Britain in the Brexit negotiations to move on to phase two which will tackle the future trade arrangement.

After the breakthrough last Friday where Theresa May was able to broker a deal which covered the Irish border and where all parties agreed it is now expected that talk on a trade deal will be able to commence in the New Year. This in my view should be seen as very positive for GBP AUD exchange rates and a move towards 1.80 could become a reality.

There is no guarantee that talks will move forward especially after some political upsets this week between Brexit secretary David Davis and EU leaders although the general mood is looking positive. In my view there is a high chance that the pound will strengthen at the end of this week.

Those clients with a pending requirement to buy Australian dollars would be wise to get in touch ahead of this key EU summit as there is likely to be a considerable market movement on the back of it. Please feel free to contact me James at jll@currencies.co.uk

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