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FED and EU Summit to drive GBPAUD exchagne rates

This week, events that are not directly involved with Australia and the United Kingdom will dictate GBPAUD exchange rates. 

The Federal Reserve which is the United States central bank, will release there latest interest rate decision Wednesday evening. Speculators are predicting that the FED will raise interest rates from 1.25% to 1.5% which will match the Australian interest rate. Regular readers will be aware that there is a direct correlation between the commodity currencies and the US dollar. As the US dollar is a safe haven and the commodity in some ways is a risk, I expect to see the Australian dollar sold off and the US dollar to be purchased.

The EU summit on the 14th and 15th December, should outline more detail about the Brexit negotiations. UK Prime Minister Theresa May has announced in recent weeks that Brexit negotiations are going well and therefore the UK and EU have agreed to start stage 2 negotiations. If the EU reiterate Theresa May I expect this could provide a further boost for sterling.

Therefore it looks like the Australian dollar could devalue Wednesday evening and the pound could have a finish to the week, therefore my forecast is for GBPAUD to break 1.80 by the close of play on Friday. If you have Australian dollars to sell and need to buy sterling I would recommend getting in touch as soon as possible.

If you are buying or selling Australian dollars in the upcoming weeks, months or years feel free to email me with the reason for your conversion (company invoice, buying a property) and the timescales you are working to and I will email you with my forecast and the process of using our company drl@currencies.co.uk.

** If you are already using a brokerage and would like to know if you are receiving the best rates possible email me with the exact figures and I will reply with our live price. This will take you minutes and in the past I have saved clients thousands! **

How long will this period of Australian dollar strength against sterling?

My recent article this weekend suggested that there was a possibility that GBPAUD could reach 1.80 in the upcoming weeks and until late yesterday afternoon this prediction looked very likely. However the DUP at the close of business yesterday evening announced they are unhappy that UK Prime Minister could offer a different border control for Northern Ireland compared to the rest of the UK. Off the back of the news the pound lost ground against all of the G10 currencies and the Australian dollar.

Later that evening, the Reserve Bank of Australia held interest rates at 1.5%, which was no surprise, however surprisingly the Reserve Bank of Australia’s commentary was extremely positive which strengthened the Australian dollar further against the pound. With the amount of strength we have seen for the Aussie rumors the Reserve Bank of Australia may appear to be backtracking and actually could raise interest rates early next year. If this is the case, it’s quite clear that the RBA have been jawboning in an attempt

However, I’m still of the opinion that the UK will secure some kind of deal in the upcoming weeks with the EU which will mean trade negotiations will begin in the New Year. If this is the case this period of strength for the Australian dollar against sterling could be short lived therefore I would recommend any client converting Australian dollars into sterling should look to make arrangements sooner rather than later.

If you are converting pounds into Australian dollars as you are emigrating or if you are leaving Australia to move to the UK and need to buy pounds in the upcoming weeks, months or years feel free to email me with the the timescales you are working to and I will email you with my forecast and the process of using our company drl@currencies.co.uk.

** If you are already using a brokerage and would like to know if you are receiving the best rates possible email me with the exact figures and I will reply with our live price. This will take you minutes and in the past I have saved clients thousands! **

Could GBPAUD break through 1.80 this week? (Dayle Littlejohn)

This week GBPAUD hit a 1 year high. Over the last three months the pound has been making considerable inroads against the Australian dollar. Exchange rates have increased from 1.62 to 1.77 and therefore a £200,000 currency transfer today compared to three months ago will generate our clients an additional AU$30,000.

The pound made further inroads against the Aussie last week when UK Prime Minister Theresa May announced that the UK are willing to pay €50bn to the EU as a divorce settlement and the EU appeared to be happy with the offer.

The UK Prime Minister Theresa May is set to meet President of the European Commision Jean Claude Juncker and President of the European Council Donald Tusk tomorrow to discuss Brexit further. The divorce settlement bill will be discussed further but a hot topic will be the Irish border.

This weekend in particular, The Republic of Ireland have stated a hard border splitting the Republic of Ireland and Northern Island is not an option and Donald Tusk has announced he would back Ireland over the UK as Ireland will remain a member of the EU.

Reports are suggesting that Theresa May’s teem believe it’s impossible to put a deal on the table for Ireland until the UK know the deal they will receive with the EU in regards to trade. Further reports Rumours suggest Mr Tusk actually agrees with Theresa May therefore I expect this topic will be put on hold on to trade discussions have begun. Therefore I expect the pound to continue to rise against that Australian dollar this week and in fact this month.

For people that buy and sell Australian dollars on a regular basis or are looking to make a one off transfer, the currency company I work for can save you money. Feel free to send me the reason for why you are converting currency, the currency pair you are trading (AUDGBP, AUDUSD), and the timescales you are working to and I will send you my forecast and the process of using our brokerage drl@currencies.co.uk.

Factors influencing GBPAUD exchange rates

In recent weeks the pound has been making considerable gains against the Australian dollar for a few reasons. The Reserve Bank of Australia more often than not have been giving dovish statements in regards to future interest rate hikes. The Governor has said that it’s likely the next decision will be to hike however this may be at the end of 2018 or even 2019.

The US federal reserve have been hinting towards raising interest rates in December which would mean US and Australian interest rate would be the same. Speculators have and will flock to the US dollar instead of the Aussie as its seen as a safer currency and therefore less risk. Less demand for the Australian dollar means it becomes cheaper to buy.

Deadline day is getting closer for the UK Prime Minister Theresa May. The EU Commission will meet on the 14th and 15th December to discuss whether trade negotiations can begin between the UK and EU. Reports are suggesting that the divorce bill and EU citizens rights could be agreed but the sticking point could still be the Irish border.

Personally I expect the Australian dollar could have a tough end to the year and major sell offs of Australian dollars into US dollars. Couple that with positive news from the Brexit negotiations, I expect GBPAUD exchange rates could push towards the 1.80 mark.

If you are trading GBPAUD this week, month or year I would recommend emailing me with the the reason for the transfer (company goods, property purchase) and your timescales and I will response with the options available to you drl@currencies.co.uk. Alternatively if you would like to discuss your requirements over the phone call 01494-787478 and ask to be put through to Dayle Littlejohn.

** If you are already using a brokerage, I would strongly recommend you compare rates as I am confident I will be able to offer you additional savings with your transfer. All you need to do is email me with the exact figures and I will reply with our live price. This will take you a few minutes and in the past I have saved clients thousands! **

 

Australian wage growth disapoints

In the early hours of the morning Australia released their latest wage growth numbers for the last quarter, and the Australian dollar lost value as the numbers disappointed.  This release has the potential to now influence the next round of inflation and consumer spending which again could cause problems for clients holding onto Australian dollars.

The US have also released important data today in the form of Consumer Price index also known as inflation. The inflation numbers rose to 1.8% from 1.7% and I believe this is the last nail in the coffin and the Federal Reserve will hike interest rates on December 13th.

In recent years currency speculators appear to bounce between the Australian dollar and US dollar, as the Australian dollar returns high interest on investments and the US dollar is a safe haven currency.  If the Federal Reserve raise interest rates US and Australian interest rates will both be 1.5% and I therefore expect to see a major sell off of Australian dollars to buy US dollars.

Therefore clients buying the Australian dollars may receive improved rates in the months to come, where as Australian dollar sellers may wish to buy their currency sooner rather than later. 

If you need to buy or sell Australian dollars and would like to save as much money as possible, feel free to email me with your requirements and I will respond with the process of using our company drl@currencies.co.uk. As a company we pride ourselves in the ability to get you a better exchange rate than your current currency provider or your bank. In addition we can outline your options and the potential future events, which will impact your exchange rate. This will help you to make informed and educated decisions.

 

Will GBPAUD break through 1.75 by the end of the year? (Dayle Littlejohn)

Economic data in recent weeks has meant that GBPAUD exchange rates have increased by 8 cents and broken through the 1.70 barrier. The reason for the improvement is positive news coming from the UK in regards to Brexit and a dovish outlook from the Reserve Bank of Australia.

Brexit negotiations are heating up and decisions are close to being made. Friday evening Michel Barnier gave a two week deadline for the UK to make key decisions surrounding EU citizens’ rights, the Irish border, and the UK’s “divorce bill”.

The theory on the market is that if the UK and EU come to an agreement in the upcoming weeks and trade negotiations start before or just after the turn of the year, this could give sterling exchange rates a considerable boost.

The Reserve Bank of Australia have been given dovish statements of late and the recent RBA minutes last week confirmed that the RBA have no interest of raising interest rates anytime soon.

Couple this with Iron ore prices tumbling down under and some forecasters suggesting another substantial fall is on the horizon due to the slowdown in China’s construction industry you can understand why the Australian dollar is under pressure.

Looking further ahead if the Australian economy continues on the same path and the UK reach a deal with the EU so trade negotiations begin, I expect GBPAUD will break through 1.75.

Therefore if you are buying Australian dollars with sterling and are prepared to take the risk holding off may provide a better exchange rate in the weeks to come, however if you are selling Australian dollars to buy sterling now is the time to convert your currency.

For people that are converting pounds and Australian dollars for the first time, it is essential that you get the very best exchange rates. If you have used a brokerage for many years or have been referred a brokerage I strongly recommend you compare rates to make sure you get the best price possible and therefore save money. This simple exercise takes two minutes and in the past I have saved clients hundreds and in some instances thousands of pounds.

My direct email is drl@currencies.co.uk Dayle Littlejohn.

Iron prices continue to put pressure on the Australian dollar

GBPAUD exchange rates have increased in value by 8 cents since September as the Australian dollar has been under pressure and sterling has rallied off the back of an interest rate hike and Brexit developments. To put this into monetary value a £200,000 conversion into Australian dollars now generates our clients an additional 16,000 Australian dollars.

The Australian economy relies heavily on iron ore, as iron ore makes up 16.3% of Australian exports. When iron ore prices fall this tends to have a direct impact on Australian dollar exchange rates. China is Australia main trading partner and as construction activity has been slowing in the 2nd largest economy the need for the commodity iron ore falls. Forecasters are suggesting that in the upcoming months iron ore prices will continue to fall and the price per tonne could plummet to $50.

The Australian dollar has also lost value in recent weeks as the Reserve Bank of Australia continue to give a dovish outlook in regards to interest rates. Governor Philip Lowe has insisted that monetary policy will not be changed in the foreseeable future and this was supported by the poor inflation numbers last month.

A data release to keep a close eye on for the remainder of the year is the US interest rate hike in December. If the US hike interest rates (87% chance according to forecasters) I expect a major sell off of Australian dollars which would make the Aussie cheaper to buy.

If you are buying or selling Australian dollars in the future, I would strongly recommend getting in contact to discuss your situation. The company I work offers a proactive service to offering economic information whilst having the ability to offer award winning exchange rates. Feel free to email me with your requirements along with the timescales you are working to and I will respond with my forecast and the process of using our company drl@currencies.co.uk.

GBPAUD crashes below 1.70 (Dayle Littlejohn)

At the end of last week the eagerly anticipated Bank of England interest rate decision provided a huge shock for clients buying Australian dollars. The Bank of England hiked interest rates to 0.5% and forecasters were predicting the pound would continue to climb against the Australian dollar and potential reach the mid 1.70s.

However as the hike was seen as ‘dovish’ because two of the members of the Bank of England voted to keep interest rates on hold and growth forecasts for next year were cut, the pound plummeted against the Australian dollar. The next question is will the pound recover and break through 1.70 once more or have Australian dollars buyers missed their opportunity.

Inflation numbers down under remain under pressure which means the likelihood that the Reserve Bank of Australia will change their tune in regards to interest rates is unlikely. Therefore I expect the Australian dollar to remain under pressure.

Brexit headlines will continue to drive GBPAUD exchange rates. Negotiators have announced that there will be three more rounds before the turn of the year and UK Prime Minister Theresa May will be hoping that stage 2 negotiations would have begun. If this is the case I expect the pound would have broken through the 1.70 barrier and actually progressed closer to 1.75. Therefore if I were selling Australian dollars to buy pounds I would take advantage of the recent movement and look to make the conversion sooner rather than later.

If you are buying or selling Australian dollar in the upcoming weeks, months or years feel free to email me with the reason for your conversion (company invoice, buying a property) and the timescales you are working to and I will email you with my forecast and the process of using our company drl@currencies.co.uk.

** If you are already using a brokerage and would like to know if you are receiving the best rates possible email me with the exact figures and I will reply with our live price. This will take you minutes and in the past I have saved clients thousands! **

Should I trade my Australian dollars into sterling now? (Dayle Littlejohn)

For people that are emigrating to the UK at some stage you will need to convert Australian dollars into Sterling and thats where I come in. The currency company that I work for undercuts banks exchange rates which means you will have more sterling for when you arrive on UK shores.

Since the Brexit vote rates for selling Australian dollars to buy sterling have been fantastic however in recent weeks the pound has been recovering against the Australian dollar due to the devaluation of the Australian dollar and the strengthening of sterling.

Australian inflation fell last week, which confirms the Reserve Bank of Australia’s commentary that an interest rate is completely off the cards. UK inflation has been on the rise for many months due to the weaker pound and it’s likely that the Bank of England will raise interest rates this Thursday which means GBPAUD could push towards the mid 1.70s.

The key economic event that will continue to drive GBPAUD exchange rates is the Brexit negotiations. The UK and EU negotiators have made it clear that decisions need to be made in the upcoming months, and UK Prime Minster Theresa May confirmed last week that both parties are close to securing the EU citizens rights deal. This is so important for sterling exchange rates as a deal will mean stage 2 negotiations can begin.

For people that need to convert Australian dollars into pounds, you are still receiving something I call ‘the Brexit discount’. In the upcoming months I expect the pound to continue making inroads against the Australian dollar therefore converting sooner rather than later would be my strategy.

If you are buying or selling Australian dollar in the upcoming weeks, months or years feel free to email me with the reason for your conversion (company invoice, buying a property) and the timescales you are working to and I will email you with my forecast and the process of using our company drl@currencies.co.uk.

** If you are already using a brokerage and would like to know if you are receiving the best rates possible email me with the exact figures and I will reply with our live price. This will take you minutes and in the past I have saved clients thousands! **

Will the Pound to Australian Dollar rate manage to hold its ground above 1.70? (Joseph Wright)

The Pound has fallen against most currency pairs today, making the converting of Pounds into other foreign currencies such as the Aussie Dollar a less attractive prospect.

Since breaking back above 1.70 against the Aussie Dollar, which has been a key psychological level for GBP/AUD since the Brexit vote the Pound has managed to hold its ground above it despite some negative data coming out the UK today.

Sterling has been helped regarding the GBP/AUD pair by Aussie Dollar weakness, as some particularly poor retail sales figures from down under recently spooked the markets.

Today it was also retail sales figures that disappointed but this time it was the UK’s retail sales figures.

With Brexit talks forever in the financial headlines at the moment putting pressure on the Pound, along with disappointing data out of Australia recently it may be a battle of which currency is the weakest that determines where GBP/AUD goes next.

There are no more major economic data releases out of the UK this week, so I expect the pair to continue to be driven by sentiment. With all that’s going on in the UK politically at the moment I there can always be a news release that swings GBP exchange rates, and if you wish to be updated if there are any big moves it’s certainly worth registering your interest with me.

Next week there will be releases that could impact the GBP/AUD rate further, so it’s worth getting in touch before the weekend if you wish to plan around any key times.

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.