Tag Archives: GBPAUD

Pound collapses against the Australian Dollar after Brexit talks stall (Tom Holian)

The Pound collapsed against a whole host of currencies including vs the Australian Dollar after a bad week politically for the UK.

The Pound began to drop on Thursday when the unofficial EU meeting didn’t go very well with a number of EU leaders rejecting the Chequers plan put out by Prime Minister Theresa May.

She criticised the EU and said if they reject her plan then they will need to come up with a plan of their own. Clearly there is no plan coming at least in the short term and this uncertainty caused problems for the Pound vs the Australian Dollar.

Even further losses came on Friday afternoon as Theresa May gave a statement on Brexit and confirmed that a second referendum will not be coming and that she is focused on making sure democracy will prevail. The markets weakened during the statement with GBAUD exchange rates falling below 1.80 after trading above this resistance level for a while.

The Australian Dollar was also given a boost after the Trump administration confirmed that they will not be putting tariffs on Australian steel and aluminium exports.

The Aussie Dollar has been under pressure recently caused by the Trade Wars between the US and China and as China is Australia’s largest trading partner this will often have a negative effect on the value of the Australian Dollar. However, as Trump has not included them in his latest weight throwing exercise this has helped the Australian Dollar to strengthen against Sterling.

The Australian economy had a further boost recently with credit ratings agency S&P upgrading Australia’s credit outlook from negative to stable for the first time in two years.

With the Australian trade surplus improving as well as record growth in employment this has been another reason for the fightback by the Australian Dollar vs Sterling.

As we go into next week the GBAUD is likely to be heavily influenced by the ongoing Brexit saga so make sure you’re well prepared for some volatility ahead for the Pound vs the Australian Dollar.

Having worked for one of the UK’s leading currency brokers since 2003 I am confident of being able to help you save money when buying or selling Australian Dollars as well as helping you with the timing of your currency transfer.

If you have a currency transfer to make or would like further information as to what is happening to GBPAUD rates then contact me directly and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

Brexit Clarity could cause further gains for Sterling against AUD. (Daniel Johnson)

GBP/AUD – We have seen Sterling strengthen over the Australian Dollar of late, breaching the 1.80 resistance point and remaining above it. One of the main catalysts is positive news on Brexit. Chief EU Negotiator, Michel Barnier stated recently that he believes it is realistic that a Brexit deal could be in place in 6-8 weeks. It has also been revealed that there maybe a solution to the Irish border. There maybe the opportunity to use technology to solve the problem using barcodes on shipping containers to verify where goods have come from and where they are going to.

The Australian economy does have it’s own worries however. Australia is heavily reliant on China purchasing it’s exports, with China engaged in a trade war with the US this will hit Chinese growth which in turn will hit the Australian economy. With global economic uncertainty causing investors to seek safer haven investments the Australian Dollar is not as popular as it once was. The US Dollar is the destination of choice offering the highest 10yr bond yields for several years and there is the prospect of further rate hikes from the Federal Reserve this year.

There is also problems with consumer spending. High wage growth areas are becoming increasingly more expensive which is forcing Australian’s to spend there funds on necessities rather than luxury goods.

I feel Sterling could be set for further gains against the Aussie, but be wary as Brexit talks intensify we could see volatility. If you are buying the Aussie short term aim for high 1.83s, possibly 1.84. I feel 1.85 will be difficult to breach unless we receive firm news on Brexit.

If you have a pending currency transfer let me know the details of your trade I will endeavour to assist. There is no obligation to trade by asking for my help, I will provide a free trading strategy to suit your individual needs. If you do wish to try our service you can trade in the knowledge we are a no risk entity, as we do not speculate. Foreign Currency Direct PLC has been in business for over 16yrs and we are registered with the FCA. If you already use a provider I can perform a comparison within minutes and I am confident I will demonstrate a considerable saving. I can be contacted at dcj@currencies.co.uk.

What can we expect this week for GBPAUD exchange rates?

The week ahead for the Australian dollar looks set to be dominated by continuing news on the likelihood of future interest rate hikes down under. Last week saw a mixed bag of data as investors weighed up the conflicting signals and the overall outlook on the currency pairing. This was underscored by a very positive unemployment report which helped the Aussie to rise against its counterparts. Good news on the Australian dollar has however been tempered by the worrying prospect of fresh economic tariffs from Trump on China, Australia’s main trading partner.

The main economic news this week will be the RBA, Reserve Bank of Australia Meeting Minutes and also the House Price Index released this evening. Later in the week we will also see the the RBA Bulletin and also a speech by Assistant Governor Christopher Kent. It was a speech by RBA Assistant Governor Bullock last week which saw movement on the rates as he highlighted growing household debt.

Clients with a currency transfer involving the Australian dollar could now face a range of events to move the rates, it does appear the factors which have weakened the Aussie in recent weeks, are set to remain. Global concerns over Trade Wars which are set to negatively impact China will weigh on economic sentiment and this will influence the Australian dollar.

If you have a transfer to consider buying Australian dollars with pounds there is also the EU Summit which is coming up which could see a volatile week on GBPAUD exchanges. Brexit continues to be the main driver on the pound and this information could see some volatility on the pair.

If you have a transfer to make involving the Australian dollar, we are in business to offer assistance with the timing and the planning of any currency transfers. For more information at no obligation please speak to me Jonathan Watson by emailing jmw@currencies.co.uk.

Thank you for reading and I look forward to hearing from you.

Jonathan

Will the Australian dollar rise or fall in September?

The Australian dollar is likely to come under increasing pressure in my opinion, as we approach a series of important domestic events in Australia and also some global issues which might driver its value. At home, concerns over the political outlook from a fractured government combine with concerns about the economy. Abroad the Trade Wars between Trump and China puts pressure on the Chinese economy, Australia’s biggest trading partner.

The Australian dollar has typically attracted investment from abroad owing to its high interest rates, a currency’s value can often be determined by the yield or return available to investors. Expectations for the Australian dollar are now lower with the US raising interest rates to a level now higher than Australia. Even the UK and Eurozone, both scarred by political and economic uncertainties in recent years, are on a path to raise interest rates.

This puts the Australian dollar on the back foot and means it cannot perform as well as it has done in recent years. Australian interest rates reached a peak of 4.75% but are now currently 1.75%. This has generally made the Australian dollar a less attractive currency to hold and I believe this will continue.

Some of the fundamental factors driving the currency markets are good indicators of future performance. The fundamentals on interest rates suggest that Australia will not be raising before either the UK, possibly the Eurozone and certainly not before the US. This will mean these currencies become more attractive to hold and might gain against the Aussie.

Political concerns in Australia have not diminished in Australia and these could see further weakness for the currency in the future. Wider global concerns could also be felt by the escalation of tensions from the Trade Wars in China, there is plenty to weaken the Aussie down the line.

If you have a transfer buying or selling Australian dollars then please do not hesitate to contact me Jonathan Watson to discuss further.

Jonathan Watson

jmw@currencies.co.uk

GBP/AUD no longer testing 1.80, is a move down into the lower 1.70’s now likely?

After testing the 1.80 mark for a number of weeks, the Pound has recently slipped from these high levels and now the pair are trading closer to 1.75. The 1.80 level does appear to be a resistance and for some time now Sterling sellers would have been best to target their transfers when the mid-market level is as close to 1.80 as possible.

Uncertainty surrounding the UK governments Brexit plans and whether they will be agreed upon in time is behind the drop in the Pound’s value. The fall hasn’t just been against the Aussie Dollar but also against many other major currency pairs with the fall against the US Dollar being one of the most dramatic, as it’s hit a 10-month low.

This week it’s emerged that the Australian jobs market is alot healthier than expected after a substantial amount more jobs were created in May than expected. This has boosted the Aussie Dollar as up until this week the average amount of new jobs was just 16,000 monthly.

One potential downside for the Aussie Dollar is the lack of movement with regards to monetary policy, as the Reserve Bank of Australia doesn’t plan on amending interest rates this year.

With many major economies beginning to make the hikes the Aussie Dollar may lose value as investors opt not to hold funds in AUD.

With little economic data out of Australia for the remainder of the week, our readers have time to get in touch and plan around transfers next week. Do feel free to get in touch if you would like to discuss next week’s economic data releases and how they could impact the rates.

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.

Trade Wars and Brexit dictate GBP/AUD (Daniel Johnson)

GBP/AUD – GBP/AUD currently remains range bound between 1.75-1.80. The outlook for both currencies is not necessarily the best. The Australian Dollar will find it hard to find a momentum due to the ongoing trade war between China and the US. Australia has a heavy reliance on China purchasing it’s exports, particularly iron ore. The tariffs imposed by the Trump administration are quite severe and with China threatening to match US tariffs Dollar for Dollar this will hit both economies hard and in turn the Australian Dollar.

During times of global economic uncertainty investors tend to avoid commodity based currencies in favour of safe haven currencies. Despite the US initiating the trade war, the US Dollar is proving to be the destination of choice. 10yr treasury bonds currently offer the best returns seen in years and the Federal Reserve have the intention to hike interest rates a further two times by the end of the year.

I feel the trade war with China could be sustained despite the US holding the majority of the cards.

From the UK side, Brexit negotiations will be key the the value of Sterling. Theresa May’s Brexit proposal has taken criticism as it goes against how Brexit was sold to the public.

The proposal includes a free trade deal for goods and agricultural products. This would essentially keep the UK’s rules and regulations aligned with those of the EU. This would allow trade in goods to flow freely and the Irish border would remain open.

The proposal for services however will be different. The UK would like to take back control of services, particularly the financial sector. Services make up 80% of UK GDP. This would result in more barriers for companies’ trading aboard.

The risk of course is that financial services will move abroad. This is a serious concern as the tax income from the financial sector is huge. May intends to reform the existing equivalence regulation where temporary customs union access is granted, but can be removed at anytime. This situation does not fill me with confidence.

Merkel has apparently agreed to a deal behind closed doors.

If the trade war escalates then we could see GBP/AUD breech 1.80 although I do think this would be a long shot. aim to trade in the 1.79s if you have an Australian Dollar requirement.

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker when the market is currently so hard to predict. If you let me know the details of your trade I will endeavour to produce a free trading strategy to suit your individual needs. Have faith knowing you will be dealing with a brokerage in business for over 16yrs, Foreign Currency Direct Plc. We are a no risk entity as we do not speculate on the market and we are registered with the FCA. If you have a currency provider take a minute to send over the rates they offer and I am confident I can demonstrate a significant saving. I can be contacted at dcj@currencies.co.uk . (Daniel Johnson) Thank you for reading.

 

GBP/AUD – Sterling stands strong depsite Davis resignation (Daniel Johnson)

GBP/AUD – The progress in Brexit negotiations is key to the value of GBP/AUD. The resignation of chief Brexit negotiator David Davis does not bode well for Sterling.

After Theresa May released her intentions for Brexit David Davis announced he thought the deal was “unworkable” and has subsequently resigned. Angela Merkel has also stated the deal is unworkable.

Despite this the Pound remained robust against the Aussie and we did not see any significant falls. This can be attributed to positive UK data, namely Services Purchase Manager Index (PMI) which came in at 55.1, the highest since October 2017. This is significant as Services makes up around 70% of UK GDP.

There is also of course the ongoing trade war with China and the US which is certainly putting off investors moving to the Australian Dollar. Commodity based currencies are not as popular in times of global economic uncertainty. China is the biggest purchaser of Australian goods and services and Chinese growth will be hindered by the trade war. This in turn will hit the Australian economy.

Despite the US initiating these trade wars the US Dollar continues to gain strength as investors seek a safe haven currency with high returns. The Fed has hiked interest rates on two occasions this year ant there is set to be more. Ten year treasury bonds currently have the highest returns in over four years.

GBP/AUD is currently range bound between 1.75-1.80. AUD buyers aim to move when interbank hits 1.79.

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker if you wish to maximise your return. If you let me know the details of your trade I will endeavour to produce a free, no obligation trading strategy for you. If you have a trade to perform I will also happily provide a free quote and I am confident our rates are among the best in the industry. I would be willing to demonstrate this in form of a comparison with any competitor. You can trade in safety knowing you are dealing with company FCA registered and one that has been trading for 16yrs. Foreign Currency Direct PLC.

If you would like my assistance I can be contacted at dcj@currencies.co.uk.

Thank you for reading. Daniel Johnson

 

 

Australian Dollar predicted to rise as global economy picks up

The Australian Dollar has been strengthening in recent weeks, with the GBP to AUD exchange rate being a good example of how much AUD has strengthened after the rate has dropped from around 1.85 to around 1.75 over the last few months.

A number of analysts have begun to adopt a hawkish outlook for the Aussie Dollar moving forward, and the HSBC chief economist for Australia and New Zealand is the most recent key figure to share this view. His name is Paul Bloxham and he’s cited the largest increase in 6 years for the counties GDP as a key indicator as to the health of the economy.

A global pick up will benefit the Aussie Dollar due to its export driven economy, but I also think its important that our readers are aware of the importance of the countries services sector as its now more important to Australia than its mining sector.

Next week on Thursday there will be a number of key releases out of Australia, mostly covering the health of the countries employment sector. If you would like to plan around this event do feel free to register your interest with me.

The economy is likely to remain resilient in the face of trade wars breaking out, due to its close trading relationship with China. One downside though is that the RBA doesn’t plan on hiking interest rates until next year, meaning that the currency may lose some of its competitive edge.

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.

 

Little reason for optimism for AUD buyers (Daniel Johnson)

GBP/AUD –  Sterling has lost significant ground against he Aussie of late. The buoyancy levels of 1.80-1.85 are gone. GBP/AUD currently sits in the 1.75’s.

This is predominantly due to Sterling weakness rather than AUD strength. There is little reason to be optimistic at present for Aussie buyers. The Brexit situation is likely to be drawn out and problematic, with votes on areas of the deal having to be passed back and forth between the House of Commons and the House of Lords for approval. Throw into the mix that many of those involved in negotiations have ulterior motives, seeking to fulfil there own agendas and Sterling could remain weak for the foreseeable future.

Economic data has also been appalling from the UK, particularly GDP which came in at 0.1%, the worst data release on GDP for over five years. The proposed interest rate hike from Bank of England (BOE) in May did not occur and I would be surprised to see one this year.

Australia is heavily reliant on China buying it’s raw materials, in particular iron ore and the US threatening to impose huge tariffs has the potential to slow Chinese growth which in turn will hit the Australian economy. China has agreed to purchase more than USD 200bn in goods and services from the US which has put a hold on the tariffs, the Aussie benefited as a result.

Current trading levels are poor for Aussie buyers, but it could get worse. I can appreciate the reluctance to trade due to the psychological aspect of trading at current levels when it was 1.84 only a short time ago, but believe me there is very little justification to get to those levels again in current market conditions.

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker if you wish to maximise your return. If you let me know the details of your trade I will endeavour to produce a free, no obligation trading strategy for you. If you have a trade to perform I will also happily provide a free quote and I am confident our rates are among the best in the industry. I would be willing to demonstrate this in form of a comparison with any competitor. You can trade in safety knowing you are dealing with company FCA registered and one that has been trading for 16yrs. Foreign Currency Direct PLC.

If you would like my assistance I can be contacted at dcj@currencies.co.uk. Thank you for reading. Daniel Johnson

 

 

What can we expect from the Australian dollar ahead?

The Australian dollar has been stronger as heightened concerns the US may not raise interest rates as quickly as expected triggered a rise in the value of the AUD. Investors have been buying up the US dollar in anticipation of a higher interest rate which would make the currency more attractive to hold, however, with the Australian dollar holding attraction with its higher interest rate, it remains strong.

The next big news for the Australian dollar will be next week with the latest RBA (Reserve Bank of Australia) meeting minutes which will give us the latest news from the RBA’s meeting last week. The expectation is for the RBA to be possibly looking to raise interest rates longer term, some commentators believe this could be as soon as the end of the year but personally, I do not expect anything too soon.

Investors are bracing themselves for the longer-term raise from the RBA which has helped to fuel the recent strength of the Australian dollar, overall impressions are for the currency to avoid some of the more familiar problems where it has dramatically weakened. A key driver of this volatility had been the move from the latest decision so, the next meeting will be crucial to get an idea of where Australian dollar will be headed next.

If you have a transfer buying or selling Australian dollars we can help with the planning and management of any deals with a view to securing the latest information and news when required. For more information please feel free to contatc me Jonathan Watson by emailing jmw@currencies.co.uk.

Thank you for getting in touch and I look forward to hearing from you and assisting in the future.