Tag Archives: Selling Australian Dollars

Australian dollar at the mercy of global news!

The China – US Trade Wars have been a major factor driving the currency markets in the last 6-9 months, impacting the Australian dollar and the economy. Australian economic data has been mixed but with Chinese data reflecting a slowdown, particularly in Manufacturing, the Australian dollar has been softer.

Looking ahead there is lots of important news in the currency markets this week to move the Australian dollar, this includes information at home and abroad. Domestically we have the latest Australian CPI, Consumer Price Inflation, data to move the market. The Australian economy has been mixed and investors are still debating the prospect of interest rate hikes in the future.

Tomorrow is also important with the latest US Federal Reserve interest rate decision, which could be a market mover on the US dollar and thereby impact the Australian dollar. USDAUD is the most heavily traded pairing for the Aussie and any large movement on the USD can ‘weigh’ the Australian dollar down against other currencies.

Later this week we have the latest US-China trade war talks which could be a market mover in the future, clients with any AUD transfers should be keeping a very close eye on the latest news. The meeting this week might yield too much news since there is still a 1st March deadline for the talks to be finalised.

Finally, Friday is the latest US Non-Farm payroll data which might well trigger volatility on the Australian dollar, by altering global attitudes to risk and viewpoints on global trade. Clients looking to buy or sell the AUD should be very conscious of these developments which should see a very busy end to the week for the Australian dollar.

If you have a position buying or selling and wish to get a fresh update o the market and all the important issues driving your levels, please do get in touch to discuss the latest news with me Jonathan Watson.

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

Jonathan Watson

jmw@currencies.co.uk

GBP to AUD Finds Support – 66 Days to Brexit (James Lovick)

The pound to Australian dollar exchange rates has found support over 1.80 on the back of the latest Brexit developments which have helped lift sterling. The Australian dollar has also come under pressure over ongoing concerns for the Chinese economy. Chinese Gross Domestic Product figures released yesterday exacerbated the situation after China reported its lowest growth since 1990.

As the second largest economy in the world any downturn in China is closely scrutinised by the markets and the Australian dollar is heavily influenced as a commodity currency. Considering the size of Australia’s export market to China then any slowdown in the Chinese and global economy will normally be felt in Australia too. The Australian dollar could now be set for a weaker period ahead especially if trade tensions between the US and China over trade continue. US President Donald Trump has called on China to “stop playing around” and do a trade deal.

Brexit meanwhile continues to bring uncertainty for the GBP to AUD pair. UK Prime Minister Theresa May updated the House of Commons yesterday signalling the next steps having been defeated on a historic scale last week to include returning to Brussels to seek a better deal. The Labour party have tabled an amendment to try and force a second referendum, what is often referred to as a peoples vote, something the Prime Minister is not supporting having highlighted risk to social cohesion. Potential government resignations have also been reported if ministers are banned from voting for any amendments aimed at stopping a no deal Brexit.

UK employment data are released this morning and any improvement in wage growth numbers are likely to be seen as welcome news for the economy and hence the pound. Market reaction is likely to be limited with bigger Brexit news. For the pound to move higher and break away for these lower levels there does need to be some certainly over Brexit and these next few weeks will likely create major volatility and potential opportunity as the exit date of 29th March approaches.

For assistance in making transfers either buying or selling Australian dollars then please get in touch with me James at jll@currencies.co.uk

GBP to AUD Exchange Rate Weakens after Chinese Yuan Strengthens (James Lovick)

The pound to Australian dollar exchange rate has fallen lower overnight with rates for the GBP to AUD pair falling to a low of 1.7653 this morning. As featured yesterday Brexit remains the dominating driver for the pound not just against the Australian dollar but against all of the major currencies. With Brexit appearing to be in stalemate and the continued pressure from opposition parties to seek other options such as a second referendum, general election or cancel Brexit, the list goes on; the uncertainty is putting added pressure on sterling exchange rates. The weekend will inevitably see all the big political beasts doing interviews with the political shows on the TV. Any clues as to what may happen next week could see a volatile start to next week ahead of the crucial parliamentary vote to be held on Tuesday.

As things stand the government is widely expected to lose the vote in the House of Commons on Tuesday. Following that she will now just have three days to return to parliament with a Plan B after she lost a vote in parliament this week which forces Theresa May to act swiftly. How Plan B might look is less than clear and the Prime Minister is reportedly keeping a tight lid on how things will play out from here. The lack of information would suggest a very volatile period for GBP vs AUD next week.

Whilst the pound is falling amidst Brexit uncertainty in these final stages of Brexit the Australian dollar appears to have been boosted following an appreciation in the Chinese Yuans value. As the Chinese currency strengthens this is often seen as good news for the Australian dollar which is a commodity currency and due to the fact China is one of Australia’s most important export markets.

The stronger Yuan is having a positive knock on effect on the Australian dollar. Chinese trade balance data released next week is a data release to pay close attention to as the markets have been showing serious concern as to the strength of the Chinese economy. The trade wars appear to be hitting China adversely and the Australian dollar is likely to be disproportionately affected by any changes in China.

For more information on the Australian dollar and for assistance in making transfers when either buying or selling Australian dollars then please contact me James at jll@currencies.co.uk

Pound to Australian Dollar Rate Weakens ahead of Key Brexit Vote on Tuesday (James Lovick)

Pound to Australian dollar exchange rates have fallen lower after what was a good rally in the GBP AUD pair. Rates for GBP vs AUD are currently sitting below 1.78 for the pair.

Brexit continues to dictate the direction of travel for the pound and yesterday’s performance in the House of Commons only highlights the uncertainty that the pound faces. The meaningful vote in parliament which is being debated this week will take place on Tuesday 15th January and high volatility for the pound to Australian dollar is expected in the run up to and after this event.

The screws were turned on UK Prime Minster Theresa May yesterday after the government lost an important vote in the House of Commons. An amendment put forward by Dominic Grieve was controversially allowed to be voted on despite the speaker John Bercow receiving advice that it should not be allowed. There could now be some implications from this government defeat adding another layer of uncertainty in the Brexit debate.

The pound is taking losses against all of the major currencies this morning and the markets may now be beginning to price in the prospect of another general election in the UK or possibly an extension of Article 50 which could even include another referendum. There is also talk of cross party support to try and find a compromise on Brexit which could result in gains for the pound. It is the prospect of a no deal Brexit though which is still a strong possibility and is preventing the pound from jumping much higher against the Australian dollar.

Economic data down under is light as we end this week although UK Gross Domestic product numbers released tomorrow could result in some market reaction for the pound to Australian dollar rate of exchange. Chinese trade balance data released on Monday will be particularly important as the markets evaluate how much of a negative impact the trade wars are having on the Chinese economy. There are real concerns over the performance of the Chinese economy at the moment and this has a knock on effect on the Australian dollar. Those with pending requirements for buying or selling Australian dollars face a very volatile week ahead with the trade data and of course the vote in the British parliament which the government at the time of writing is expected to lose.

For assistance in making transfers at excellent commercial rates of exchange in either direction then please feel free to contact me James. My email address is jll@currencies.co.uk

Australian Dollar to Pound Rates Strengthen on Hope of Positive G20 Summit (James Lovick)

Pound to Australian dollar exchange rates have fallen lower to below 1.75 for the GBP AUD pair as Brexit uncertainty remains the biggest threat to the pound ahead of the parliamentary meaningful vote around the 12th December. There are reported 100 Conservative MP’s who have signalled that they will vote against the Prime Minister which leaves an even more uncertain period ahead. If the Prime Minister is unable to push forward with her Brexit deal then there are a number of different outcomes. A second vote in the House of Commons is perhaps the most likely outcome although a change of Prime Minister, a second referendum, a no deal Brexit or a Norway style trade deal cannot be ruled out.

The EU have stated that this is the best deal the UK will receive so in the event that Theresa May is unable to secure a better deal then the prospect of no deal in my view is starting to look much more likely to happen. The Bank of England has made worst case scenario predictions that there could be a crash in the pound of up to 25% which is making the price of sterling extremely sensitive to political developments in the UK.

The Australian dollar could also see a substantial boost if there is a breakthrough or at least a statement of intent for the US and China to reduce tariffs on trade and come to a future trade agreement. The Australian dollar could be big beneficiary if progress is made at the G20 summit this weekend where a slot has been put aside for US China talks. We’re not there yet and US President Donald Trump has been threatening more tariffs this week so it remains to be seen how constructive these talks will be if talks don’t well and tariffs are imposed on all Chinese goods then the Aussie could weaken considerably lower as those concerns grown on the future of global growth.

For more information on the Australian dollar exchange rates and for assistance on making transfers either buying or selling Australian dollars then please feel free to contact me James at jll@currencies.co.uk

GBP to AUD Exchange Rates Uncertain ahead of EU Summit 25th Nov (James Lovick)

Pound to Australian dollar exchange rates remain on the back foot as uncertainty over Brexit continues to the big driver for GBP to AUD rates. The pound is trading at just over 1.76 against the Australian dollar and whilst there has been some support this week any major improvement is likely to be limited for the pound. UK Prime Minister Theresa May is still trying to seal a deal on the political declaration for the future trading relationship between the UK and EU and a meeting last night failed to provide a breakthrough. Theresa May will now fly back to Brussels on Saturday ahead of the emergency EU summit which commences on Sunday.

The political declaration will be an important component to the deal and the specific wording of the text will help determine whether parliament will vote in favour of the deal that is almost on the table. Ultimately it will all come down to a meaningful vote in parliament on the final deal which will decide the future of the UK and the pound in the short term. It leaves a very uncertain few weeks for sterling exchange rates whilst the markets await this key vote in parliament.

The Australian dollar could come under some renewed pressure in these coming weeks as the issue of trade wars continues to impact on global markets. So far there has been no compromise for a future trade deal between the US and China as preparation are being made behind the scenes for a summit in Buenos Aires. Relations are likely to become even more tense as both Europe and China seek to argue that Donald Trump cannot continue to impose tariffs on steel and aluminium on the basis of national security.

The World Trade Organisation (WTO) will need to rule on this subject and the outcome will likely create added turmoil in the financial markets. If for example the WTO challenged the US on this point then in an extreme scenario the US could find itself breaking away from the WTO entirely. This could see a flight to safety to the US dollar leaving the Australian dollar in a risky position. Once again there is another focal point in the diary which will help direct GBP vs AUD.

For more information on Australian dollar exchange rates and how to find the optimum time to convert funds either buying or selling Australian dollars then please feel free to get in touch with me James at jll@currencies.co.uk

Pound to Australian Dollar Forecast – GBP AUD Crashes after Brexit Secretary Resigns (James Lovick)

Pound to Australian dollar exchange rates have crashed dramatically with rates falling by more than 2% to the lows of 1.75/1.76 after a brutal day in British politics. UK Prime Minister Theresa May has reached an agreement with the EU over the draft withdrawal agreement but support from her cabinet is not unanimous. So far and in a single day there were seven government resignations including Brexit Secretary Dominc Raab which sent the pound tumbling. GBP to AUD rates now face yet another volatile day as the markets prepare for more government resignations and a possible leadership challenge.

Brexit supporter and chair of the backbench European Research Group has called for a vote of no confidence in the Prime Minister and believes that enough letters to the 1922 Committee will be reached in the comings days to trigger a vote of no confidence. The Prime Minister must also put in place a new Brexit Secretary and it has been reported that Environment Secretary Michael Gove has turned down the offer. Where that leaves Michael Gove is less clear and many are expecting a resignation which would add more pressure on Theresa May and further weakness for the GBP to AUD pair. The outlook is so uncertain in British politics that there is room for further weakness for the pound against the Australian dollar in the short term.

The Australian dollar meanwhile has been boosted after strong employment data down under pointing to health consumer spending. A further 42,300 jobs were created in October which was significantly higher than the September reading. This will be welcome news for the Reserve Bank of Australia which has held concerns over weak wage growth and low inflation. The belief is that an improving labour market will feed through to higher wages which will allow the central bank to start raising interest rates. This is starting to look likely for 2019 with a good chance we may see the first rate hike in August next year.

There are likely to be major movements in these coming days. For assistance in making transfers either buying or selling Australian dollars then please get in touch with me James at jll@currencies.co.uk

GBP AUD Exchange Rates Fall Below 1.80 (James Lovick)

The pound has fallen lower against the Australian dollar with rates for the GBP AUD pair falling below 1.80 once again. What happens in the US in these coming weeks and months is likely to have a big impact on the Australian dollar. With the US midterm elections out of the way it will be interesting to see how investors react to the news and if the results have an impact on whether he is able to implement his planned policies of increased expenditure in the US.

More importantly the future trade policy from the White house especially with China will be a major driver for GBP AUD rates. There have been noises that a meeting between China and the US could bear fruits for a future trade deal. Investors are concerned that an escalating trade war could have a negative impact on the Australian dollar as funds move to the safety of the US dollar. If an agreement can be reached though then this should benefit the Australian dollar going forward as confidence is restored in the commodity currency.

The Brexit negotiations have advanced in recent weeks which has helped boost the pound against the Australian dollar. Reports are filtering through in the media that we could be days away from a Brexit deal. Expect a few more weeks of heightened volatility though as any deal will have to be put before parliament which could make for a bumpy ride.

The Reserve Bank of Australia meet this evening and any clues as to when the central bank next raises interest rates is likely to see added volatility for the dollar. The US Federal Reserve are still set to hike interest rates again this year and a meeting is being held this evening. The markets are expecting a rate hike to come in December although anything is possible this evening. As the differential widens between US interest rates and rates down under there is likely to be more weakness for the Australian dollar.

For assistance in making transfers when either buying or selling Australian dollars then please get in touch with me James at jll@currencies.co.uk

Australian Dollar Boosted on Strong Growth Report (James Lovick)

Australian Gross Domestic Product (GDP) numbers released yesterday have helped support the Australian dollar after a strong number was produced. GDP rose by 0.9% which was higher than expected due to higher consumer spending which is lending support to the dollar. On an annual basis the figures have highlighted the fastest growth since 2012. Whilst the data presents a positive outlook the implications of the current trade wars are unlikely to have yet been realised.

Chinese import and export data this weekend could see a big market reaction for the Australian dollar. With heavy trade tariffs imposed on US and Chinese imports there are fears this could filter through into the wider global economy. Any signs that China’s economy is slowing down could see the Aussie come under renewed pressure. The trade wars between these two superpowers show no signs of easing at this time and so the outlook for the Aussie looks less stable. There is a high chance this could hamper the Aussie going forward with room for a sizeable drop.

GBP AUD

Rates for GBP AUD have seen a boost higher this week with rates jumping higher to 1.80 for the pair. In fact the pair has risen by around 7 cents since the beginning of August creating a good opportunity for those clients looking to buy Australian dollars. The pound was boosted against the Australian dollar yesterday on reports that Germany and the UK were softening their stances with regards wording for the withdrawal agreement although this proved short lived.

Politics and Brexit are the number on driving force for GBP AUD and now that parliament has resumed after the summer recess then these next few months will be paramount in the future direction for the pair. I am expecting a hugely volatile few months and with this come opportunity for buyers and sellers alike.

For more information on the Australian dollar and how to make the most of any market movement when either buying or selling Australian dollars then please feel free to contact me James at jll@currencies.co.uk

Australian Dollar Forecast – Trump Agrees Zero Tariffs with EU (James Lovick)

The pound has made a small recovery against the Australian dollar with rates back over 1.77 for the GBP AUD pair. The ongoing theme for the Australian dollar in recent weeks has been the trade war story which has stemmed from trade policy decisions made by US President Donald Trump. The latest in the story is that the President has now agreed with the EU tariff free trade between the US and EU. Whilst this does not directly have an impact on the Australian economy it does signal a change in tact by President Trump and could suggest there is light at the end of the tunnel in this escalation of trade tariffs with China. The concern for the Aussie is that if there is a global trade war then the commodity currencies could suffer so any softening in trade policy coming out of the US could actually be seen as good for the Australian dollar.

Economic data from down under has been stronger in this last month with retail sales and consumer confidence performing better than expected. The recent employment data was strong and highlighted a buoyant workforce which has also proved beneficial for the Australian dollar.

Now that the British parliament has ended for the summer recess there are unlikely to be any major developments on Brexit until the end of August or early September. The pound has been left on a weaker footing after the high profile resignations in government and some concern over the dreaded no deal scenario. Clients looking to buy Australian dollars could find some better opportunities on the horizon if a deal can be reached on Brexit, but we are still probably a few months away from such an outcome.

For assistance in making transfers either buying or selling Australian dollars at the best rates then please get in touch with me James at jll@currencies.co.uk