Tag Archives: GBP/AUD forecast

Will GBP/AUD Rates Dip Further? (Matthew Vassallo)

The AUD has found some support against GBP over the past couple of weeks, with the pair moving back towards 2.10 at the low. This is a marked improvement on recent levels, with the AUD slipping below 2.20 only a few weeks ago. Many investors had expected this slide to continue, with the Australian economy suffering heavily due to a major slowdown in their economy, particularly their export trade. This was due to the on-going problems facing the Chinese economy, who as regular readers will know are Australia’s largest trade partners and although they are by no means out of the woods yet, a couple of factors seem to have eased some pressure in the short-term.

Many investors had anticipated the Reserve Bank of Australia (RBA) would cut their base interest rate further, in order to help ease pressure on the economy but when this did not occur the markets took it as a positive and a sign of strength and this positively impacted the AUD, which gained value as a result. The Australian economy also received a boost with a huge spike in Chinese tourism, which again helped breed some market confidence. These factors combined have helped to drive GBP/AUD rates down and I feel the AUD will now find support under 2.20.

These was some key data releases this morning for the UK, with the latest Bank of England (BoE) interest rate decision and subsequent minutes. As anticipated rates were kept on hold at 0.5% and with an 8-1 vote against a rate hike, conditions have not changed from last month. With no rate hike foreseen until at least the 2nd quarter of 2016, we may find the AUD puts pressure on the 2.10 mark over the coming weeks.

If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me directly on mtv@currencies.co.uk

GBP/AUD rates still sliding and should continue (Joshua Privett)

The slide on GBP/AUD continues and rates have now crept lower into 2.11.

The Dollar is continuing to attract investment with the Reserve Bank of Australia’s recent decision not to cut interest rates further and confident statements about the nation’s ability to ‘weather any storm’.

This is in sharp contrast to recent announcements about the UK’s future interest rate timeline which has recently produced a rather negative spin compared to the Dollar’s positive one.

Arguably the single largest determinant of a currency’s value since the financial crisis of 2007/8 has been their timeline for raising interest rates from these historic lows. Sterling has been gaining ground against most of its major counterparts since the start of this year, with regularly postings of strong data, this rate rise appeared to be just around the corner.

However, record low inflation has hit the UK and has become ingrained. Fears of lowered global demand following events in China are also causing hesitancy in raising rates alongside this, so now a rate hike isn’t expected until the back end of 2016.

The disparity between positive and negative news surrounding the interest rate saga between the two nations is why rates have corrected so sharply for GBP/AUD in recent weeks, and why this trend seems to be continuing unabated.

Tomorrow will likely see confirmation that this trend will follow-on for the rest of October when the interest rate decision for the UK economy is announced, as well as a statement about future financial policy. With no change in the current situation in the UK, it is more likely than not that further Sterling weakness will follow when no solid timeline for an interest rate hike in the near term is announced.

Anyone with AUD to buy in the short term should be looking to move before this announcement at 12 pm tomorrow afternoon. I strongly recommend contacting me on 01494 787 478 and asking the reception for Joshua to receive a competitive quote on your transfer. We can discuss a strategy based on your situation to make sure your Dollar return is maximized, even if your requirements are not for a few months time. jjp@currencies.co.uk 


RBA interest rate decision to come in overnight (Joshua Privett)

Overnight the Reserve Bank of Australia will be announcing  its interest rate decision for the Australian economy.

Glenn Stevens, the Governor of the RBA, has been discussing the positive aspects of the Australian economy over recent months, a 180 from his comments at the start of the year.

Due to his recent change of tone, it seems that instead of further rate cuts, which he alluded to in the summer, he may now be putting any such decisions on hold until 2016.

The Australian Dollar has been gaining against most major currencies over the past week due the consensus that no rate cut will take affect. 

As such I don’t expect a huge amount of volatility in the rates tomorrow. Should this be confirmed then GBP/AUD may dip slightly lower than the 2.13’s on offer, however, I believe rates should still be above 2.10.

The rate statement will also give us a better idea of Steven’s long term view of the economy in the wake of Chinese slowdowns.

Contact me overnight on jjp@currencies.co.uk to get the news on rates tomorrow morning, and new long-term forecasts. If rates tick down further, I would be happy to offer a competitive quote for anyone looking to buy AUD who want to prevent further losses. I can also assist those looking to sell if your needs cannot wait and you can’t ride any moves in your favour any further.

Chinese data set to cause spike in GBP/AUD tomorrow (Joshua Privett)

This is the same story over the past few months, and will likely give us the same patterns.

Markets have been obsessed with how the Chinese data to be released on Thursday morning could effect global exchange rates. Poor news out of China has seen rates on GBP/AUD catapulted to new highs almost twice a month since August.

As a big buyer of Australian exports, any indications of weakness in the Chinese economy has directly resulted in poor confidence for the Australian economy going forward, which translates into Australian Dollar weakness.

Since Monday, markets have been talking morbidly about the release of further Chinese data tomorrow which is set to confirm the continuation of a major slowdown in their economy. Hence, we are expecting further Australian Dollar weakness overnight.

However, two facts must be at the forefront of anyone looking to purchase Australian Dollars.

These rates have continued to fall down from these spikes upwards, and those buying levels are not sustainable. Plus a string of positive data from the Australian economy recently (positive employment and trade figures) is helping to correct GBP/AUD faster than expected from these movements in the favour of buyers – so be ready to move 24 hours following the data release.

Furthermore, Chinese data is now starting to weaken Sterling itself. This prolonged bout of Chinese depression on the markets is started to make an interest rate hike in the UK for 2016 less and less likely. You can’t raise rates if future forecasts for the demands of your goods and services are now dropping. The lesson from this is that this spike will not be as high as we have previously seen.

Anyone looking to buy AUD in the next month should be looking to jump on this opportunity. There is no more data expected for China during most of October, as a result we will get a repeat of familiar patterns recently, where GBP/AUD gradually correct themselves, as most currency traffic goes into the Australian Dollar due to its cheapness and devalues the currency.

I strongly recommend that anyone with Australian Dollars to buy should contact me on jjp@currencies.co.uk to receive a free quote on their transfer and my personal opinion on how to maximise the returns on any planned transfer. I offer a rate beating guarantee here to make sure you make the most of any positive spikes rather than missing out on the best rates available in 8 years.

Positive tones from RBA Governor surprise markets (Joshua Privett)

The upbeat tones from Glenn Stevens, the Governor of the Reserve Bank of Australia, about the state of the Australian economy are a change in attitude which has strengthened the Australian Dollar across the board this morning.

For the entirety of this year Mr Stevens has been painting a negative view of the economy. He feels that a cheap AUD was key to the success of the Australian economy as a whole – making their exports more competitive whilst demand was slowing for their products. His negative comments have regularly caused GBP/AUD to rise by a cent or more over the past few months.

After the events of Black Sunday last month, however, he has now changed tact. The image of the Australian economy he presents is now an optimistic one. He emphasized the economy was in a position to weather any economic downturn for the Chinese economy, and this renewed confidence has caused the Australian Dollar to strengthen from 2.17 to 2.14 on GBP/AUD rates.

His motives are two fold. Firstly, the Dollar is now cheap enough for his liking to be competitive on export markets but still be strong enough to afford the foreign imports the Australian economy requires. Secondly, he needs to show confidence after a period of extreme doubt following the recent downturn in China’s economy.

It seems a downward trend is now fully established for GBP/AUD rates. I would strongly recommend that anyone with AUD to buy should move sooner rather than later, and our regular readers should recall that rates can be pegged at their current levels if you do not need to purchase your currency until later in the year.

Contact me on 01494 787 478 and ask for Joshua for a free quote on your transfer as well as tailored advice to your situation. jjp@currencies.co.uk

Where Next for GBP/AUD Exchange Rates? (Matthew Vassallo)

GBP/AUD rates have slipped slightly over the past week, with the pair moving back below 2.15 at the low. Whilst these levels should still look extremely attractive to those clients purchasing AUD, we have seen a slight dip from the highs of last week, when the pair were trading above 2.20.

Despite yesterday’s positive UK employment data and the on-going problems in the Chinese economy (Australia’s largest trade partners), the Pound could not recover this lost ground.

A key development in Australia this week was the ousting of the now former Prime Minister Tony Abbott. He was extremely unpopular and rightly or wrongly has been blamed for the current demise of the Australian economy. This move seems to have brought some confidence back to the markets and the AUD could now find some protection under 2.20 in the short-term, although I do not anticipate further sustained improvement for the AUD unless we see a turnaround in the Chinese markets.

On Sterling’s side I expect the Pound to receive continued market support, with the majority of UK data looking strong. I don’t think we will see the Bank of England (BoE) raise interest rates before the turn of the year and this may dampen any further aggressive gains for the Pound, so personally I would be tempted to secure a rate around the current levels, which still remain close to a 7 year high.

If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me on mtv@currencies.co.uk

*Breaking News* Tony Abbott ousted as PM! (Joshua Privett)

The Australian Dollar has taken a boost in confidence this afternoon following the vote of no-confidence and the snap-ballot for the Liberal Party which saw Tony Abbott ousted by Malcolm Turnbull – a clear victory over Abbott by 54-44.

The incredibly poor performance by Abbott on opinion polls led to the vote, so his dismissal and the clear majority of Turnbull has been received well by markets as a victory for political stability in the ruling party. It is difficult to gauge any long term impact from this. However, it’s unlikely that this  will overshadow the current macro-economic forces in place, which are described in my article below. The significance is more short-term, but this boost is a welcome one for AUD sellers ahead of the RBA minutes to be released tomorrow.  See the article below for details. For example GBP/AUD has fallen from 2.18 to the brink of 2.15 already.

Anyone with an AUD requirement can contact me by calling 01494 787 478 and asking for Joshua to receive some tailored advise for your situation in the wake of this breaking news and to receive a quote for your transfer. Alternatively, email me on jjp@currencies.co.uk 

GBP/AUD expected to be volatile with RBA minutes tomorrow (Joshua Privett)

GBP/AUD has been one of the major currency winners after the events of Black Monday last month. Highs of 2.23 were reached, but since then the rally for the AUD down to 2.16 on the markets today has been largely unabated.

Two reasons can explain the recent rally. The Australian economy has been publishing a string of positive data recently to show that they are in the process of recovery from bottomed-out commodity prices. Employment has been making regular gains recently and the recent shift in ore prices have given greater confidence to the Aussie.

Secondly, normal currency patterns of opportunistic buying at cheap levels can explain the gradual and sustained drive downwards for GBP/AUD. With the best rates available since 2008, it isn’t difficult to comprehend how many people are moving assets over to Australia while they are so cheap. Proceeds from house sales, inheritances, even savings are all being converted into AUD after the mammoth gains enjoyed recently. This drives up the value of AUD through greater demand which lowers GBP/AUD.

Before this trend continues back to where rates where before Black Monday, stuck in the 2.10-2.12 region, I expect a short term boost for GBP/AUD rates.

Tomorrow morning the Reserve Bank of Australia will be releasing the minutes from their recent meeting. Glenn Stevens, the Governor of the RBA, has repeatedly attempted to artificially devalue the value of the Australian Dollar to make their economic exports more competitive whilst global demand was slowing. Recent data for the Australian economy has shown improvement, enough for him to justify this approach.

With the Australian Dollar rallying he will likely emphasize the negative aspects of the recent China crisis during the meeting’s minutes in order to lower confidence in the AUD and keep his financial plan on track. This, however, will not change the current positive forces benefiting the AUD, so should this occur the boost will be temporary.

Anyone looking to take advantage of this event tomorrow should contact me on 01494 787 478 and ask for Joshua for tailored advice on how to buy when the market reaches a peak, as well as a free quote on their transfer. The current buying levels for AUD rates are fantastic, and I am happy to help you squeeze a little bit more out of the rates before the downward trend takes hold once more. jjp@currencies.co.uk

GBP/AUD rates will be subject to incredible volatility today (Joshua Privett)

GBP/AUD exchange rates have already been swinging wildly. As Asian markets opened the release of poor data concerning the price of raw and primary materials in Chinese industry was shown to be falling rapidly, by 5.9% last month alone. With  a significant portion of Australian exports dependent on higher prices in these areas, the Australian Dollar weakened sharply. But only briefly. GBP/AUD reached highs of 2.20.

However, later that same morning Australian employment data came out to halt worsening confidence in the Australian Economy. Unemployment dropped down to 6.2% and 17,000 jobs were added to the economy last month when a mere 5,000 were expected.

This roller coaster resulted in GBP/AUD rates ending up lower than the close of trading yesterday, with GBP/AUD rates now down in the 2.17’s.

I expect this downward trend to continue as capital continues to flow into an incredibly cheap Australian Dollar, international buyers for Australian properties in Sydney and Perth are already up 6.4% and 7.9% respectively in the first 6 months of this year alone. This will drive up the value of the Australian Dollar through demand to help counteract what is likely to be continued Chinese economic weakness.

On the horizon this morning, released at 12:00 BST in a few hours, will be the UK interest rate decision for the Bank of England. This will be where the events of Black Monday cause some Pound weakness to balance out the onslaught of negative news for the Australian Dollar in recent weeks.

The UK was forecasted to raise interest rates by the start of next year. However, following global uncertainty on the massive scale we have experienced recently, this will likely have been pushed back. Last month the minutes from the Bank of England meeting reflected a dovish tone even before the events of Black Monday. The resulting drop in GBP value across the board was staggering. GBP/AUD dropped two cents in the space of 40 minutes.

Should more dovish tones be recorded we could expect further sudden spikes downward below the 2.17 mark. I strongly recommend that anyone with a requirement to buy Australian Dollars to move ahead of this event. There is no evidence that rates will rise off the back of this, they will either hold or fall, which will make waiting either an expensive or fruitless decision.

Contact me on 01494 787 478 and ask for Joshua for a free quote on your transfer and tailored advice on your situation. I guarantee to beat any quote given to you elsewhere to help you maximize your AUD return while rates are still so close to 7 year highs.

Alternatively, those with AUD to sell, email to discuss how to ride this likely surge in your favour, and we can construct a strategy on how to stretch your returns in a down market.

AUD Forecast Remains Negative (Matthew Vassallo)

The AUD’s woes have continued of late and despite a slight improvement against Sterling this week, the outlook for the coming weeks remains negative. The AUD has struggled all year for a variety of reasons but of late it’s the major downturn in the Chinese economy, which seems to be dragging the AUD’s value down. Australia’s trade links with China have been well documented but it is because of this heavy reliance on their exports, which is causing their economic output to drop and ultimately the AUD to weaken.

Add to this the Reserve Bank of Australia’s (RBA) recent stance and they have been happy to see the AUD’s value drop, in the hope this will boost the export of raw materials and help to solidify their economy. With overinflated house prices, particularly in Sydney also causing their economy problems, it may be that things continue to get worse before they improve.

Looking at short-term trends and the AUD has found some support this week, with an improvement of roughly 2 cents against GBP. With a host of employment & inflation data out overnight in Australia, expect increased volatility on AUD exchange rates as we head into the weekend.

We also have the latest Bank of England (BoE) interest rate decision and latest minutes released tomorrow. Whilst we do not anticipate a change in the base rate, any indication of whether members of the BoE did vote in favour of a rate hike is likely to cause Sterling volaitlity and could push GBP/AUD rates back above 2.20.

If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me on mtv@currencies.co.uk