Tag Archives: Selling Australian Dollars

Pound to Australian Dollar: Brexit continues to Dictate GBP/AUD

The Brexit saga continues and now we are looking at an extension. GBP/AUD rates had recently risen to the highest levels since June 2016, breaching 1.88. This can be attributed to positive news surrounding Brexit, rumours were circulating that Brussel’s could make concessions on the Irish border and the chances of a no deal scenario dropped considerably.

PM Theresa May addressed the nation yesterday evening and made a plea to MPs to support her deal ahead of what is likely to be a third and final meaningful vote.

May also confirmed she had written to President of the European Commission, Donald Tusk to request an extension to Article 50. she has requested an extension until 30th June.

She also stated that she would not approve a long term extension to Article 50. This immediately raises the question whether this means she is prepared to step down as Prime minister should her deal be voted down and and then vote for a lengthy extension for talks.

She also said “this House will have to decide how to proceed”, if her deal is rejected for a third time.

If May were to resign you can expect this to hurt Sterling significantly.  GBP/AUD has now dropped into the 1.84s.

 US/China Trade War –  Due to Australia’s heavy reliance on China purchasing its goods and services and slow down in Chinese growth has a kick back on the Australian economy and in turn the Australian Dollar.

The US/China trade war is currently hurting the Australian Dollar and if it were not for Brexit I think Sterling could be making decent gains against the Aussie.

There were rumours the trade war could be resolved by the end of the month, but Trump yesterday threw a spanner in the works saying the following:

“We’re not talking about removing them, we’re talking about leaving them for a substantial period of time,”  “Because we have to make sure that if we do the deal with China that China lives by the deal because they’ve had a lot of problems living by certain deals.”

Brexit will continue to be the key driver on GBP/AUD. I think at this point we are looking at an extension as both parties do not wish to deal with a no deal scenario. I think if an extension is called there will not be any great shakes on the market. If Brussels do give concessions on the Irish border however, expect substantial Sterling strength.

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 18yrs. Foreign Currency Direct PLC.

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

GBP to AUD Rates Break 1.85, Brexit Extension Possible (James Lovick)

The pound to Australian dollar exchange rates has rocketed higher with levels breaking 1.85 for the GBP to AUD pair. The pound has spiked higher after a statement from Theresa May yesterday where she referenced a potential extension to Article 50. There has been pressure from members of her cabinet who have threated to resign unless no deal is removed as a potential outcome.

The markets must now wait for the meaningful vote to be held before 12th March which will see whether the existing withdrawal agreement can be pushed through parliament. If the deal does not go through as insufficient changes have been made to the backstop then there will be a vote on 14th March for an extension of Article 50 if MP’s reject a no deal.

Meanwhile Prime Minster Theresa May is in Brussels meeting with Michel Barnier to try and make legally binding changes to the contentious Irish backstop. The attorney general Geoffrey Cox has also been present in meetings to try and work a legal codicil to go with the withdrawal agreement that would carry legal force and would then pass through parliament. When the outcome of these talks is known this is likely to result in considerable market movement for the GBP vs AUD pair. Expect high volatility and potential good opportunities on the back of any new developments surrounding Brexit in these final stages.

The Australian dollar meanwhile has found support after a calm statement from US Fed Chair Jerome Powell indicated the Fed would be patient with interest rates. Since the beginning of the year the Fed have been more dovish in its approach to raising interest rates and softening its stance with concerns of a slowdown in the US and more importantly the global slowdown stemming for China which is being exacerbated by the US China trade war. Investors are now considering whether to continue to invest in the dollar if the Fed is coming to an end of its rate tightening cycle which bodes well for the commodity currencies including the Australian dollar.

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

RBA under pressure causing the Pound to make gains vs the Australian Dollar

The Reserve Bank of Australia has once again signalled that things are not looking in great shape for the Australian economy owing to higher unemployment levels combined with lower inflation if UK house prices continue to fall.

Indeed, according to some reports there has been a drop of almost 60% in investment from foreign buyers in to the property market in Australia.

Up until last year Australian house prices had been rising significantly but both Sydney and Melbourne which were leading the market in terms of house price growth have both started to feel the effects and have started to drop during the last 18 months.

With a lot of wealth for Australians tied up in their houses the fall in value is clearly a concern for the central bank as this could trigger a fall in consumer spending and then cause GDP to fall.

At the moment Australian interest rates are at their lowest levels in over 50 years and there appears to be little appetite to consider raising interest rates any time soon.

Indeed, if anything the expectation is for the Reserve Bank of Australia to look at cutting interest rates during 2019 and this is one of the main reasons for the weakness in the value of the Australian Dollar against the Pound.

In the meantime the Australian Dollar is also feeling the pressure owing to the ongoing Trade War issues between the US and China.

China is Australia’s largest trading partner so any signs of a slowdown in growth or reduced demand will often have a negative impact on the value of the Australian Dollar and this is another reason why the GBPAUD exchange rate has been trading around the 1.80 level recently.

Relations between the two superpowers appear to have stalled once again and hopes are that a deal covering Chinese goods coming in to the US will be resolved before the deadline of 1st March.

Both sides are hoping that a resolution can be found but we are less than 2 weeks to go before the proposed deadline and this could negatively impact the value of the Australian Dollar which is good news for anyone looking to buy Australian Dollars in the next fortnight.

If you would like a free quote when buying or selling Australian Dollars and would like to save money on exchange rates compared to using your own bank then contact me directly and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

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