Tag Archives: sterling exchange rates

Pound to Australian Dollar – RBA Cuts Rates

The pound to Australian dollar exchange rate has weakened despite an interest rate cut from the Reserve Bank of Australia last night. The RBA have cut interest rates from 1.25% down to 1% as concerns over a global slowdown and a downturn in Australia continue to influence the central bank’s decision making. The cut last night had been largely priced into the markets and there hasn’t been a major market reaction to the news.

The pound is nonetheless weaker against the Australian dollar although this is more likely to do with the truce between the US and China which will stop further trade tariffs being applied. There is a better opportunity to convert Australian dollars into pounds on the back of these recent developments. This may not last as there are reservations that the issue of the US China trade war will be resolved. The RBA may or may not wish to cut interest rates again and this topic is likely to generate much discussion. The US Federal Reserve are also expected to cut interest rates this month and this could have a far reaching impact on the Australian dollar. There has been talk of a US interest rate cut of 50 basis points which would be more extreme in approach than we have seen in recent years.

Brexit meanwhile continues to be the main driver for sterling exchange rates and the GBP to AUD pair is likely to see a volatile few months ahead of the latest deadline of 31st October 2019. The Conservative leadership battle continues between Jeremy Hunt and Boris Johnson both of who are pushing to deliver on Brexit. Boris Johnson however has been more forthright having stated that Britain will leave the EU by this date, come what may, do or die.

The prospect of a no deal outcome is now becoming a credible proposition and this has been reflected in the price of sterling across the board after Theresa May resigned as Prime Minister. Those with pending currency requirements either buying or selling Australian dollars would be wise to plan around these important events.

For morte information on the Australian dollar and for assistance in moving funds then please get in touch with me James at jll@currencies.co.uk

Will the RBA cut interest rates and the impact on the Pound vs the Australian Dollar?

The Pound has really been struggling against the Australian Dollar in recent weeks owing to the ongoing political uncertainty in the UK.

The Pound is now trading at its lowest level against the Australian Dollar in a few weeks and I think we could see further losses ahead for Sterling exchange rates.

Next week the Reserve Bank of Australia will once again meet to decide the future of monetary policy down under.

With the Australian economy coming under more and more pressure recently there is a strong likelihood that we’ll see a cut in interest rates on Tuesday morning.

As this is widely anticipated it may not have the impact on exchange rates that you may think so if you’re banking on a big movement for GBPAUD exchange rates it may not happen.

The main thing to look out for will be the statement from the RBA as if they hint that there are more interest rate cuts planned for the future then this could weaken the Australian Dollar so make sure you pay close attention to the announcement.

Indeed, some analysts think that the RBA should cut interest rates by 0.5% but I think that would be too aggressive for the time being.

We also have the release of Australian retail sales due out on Tuesday morning. Retail sales are a good indicator as to the health of an economy so any further signs of a slowdown will provide the RBA with further justification to cut interest rates.

Then on Wednesday we have another big data release for Australia with the latest GDP data for the first quarter. The expectations are for growth of 2.5% which would be an improvement from the previous quarter of 2.3% for year on year so we could see some volatility for GBPAUD exchange rates during the middle part of next week.

If you have a currency transfer to make and would like to save money when buying Australian Dollars then contact me directly for a free quote and I look forward to hearing from you. I have worked for one of the UK’s leading currency brokers since 2003 and I’m confident that I can also help you with the timing of the trade.

Tom Holian 

teh@currencies.co.uk

 

GBP to AUD Strength – Brexit Imminent (James Lovick)

The pound to Australian dollar exchange rate has rallied higher with rates for the GBP vs AUD pair sitting above 1.86. Brexit continues to dictate the direction of travel for GBP AUD and the more optimistic mood on reaching a deal is helping to support the pound. The markets have begun pricing in the prospect of a deal being reached by 29th March and failing that there is a chance that an extension of Article 50 may be required. Either outcome gives more certainty in the markets as to what the economic picture looks like for the next 18 months.

What is important to highlight is that the chances of a no deal Brexit are looking less likely which is seen as positive for sterling exchange rates. Meetings between Brexit Secretary Stephen Barclay and Attorney General Geoffrey Cox and their EU counterparts resume today seeking to find legally binding changes to the contentious Irish backstop. Any breakthroughs this week could help lift the pound higher although to date there haven’t been any offerings from the EU to suggest a compromise is in the offing.

The hugely important meaningful vote is to be held before 14th March and the outcome should present considerable volatility for GBP to AUD. If the government is unable to push the vote through then the pound faces another uncertain two consecutive days as more votes will be held in parliament. Bank of England Governor Mark Carney will be speaking later today and any negative comments which he is known for especially when it comes to Brexit could see the pound come under pressure.

The Australian dollar could be set for a big boost in the weeks ahead depending on how the ongoing trade talks between the US and China unfold. Reports have emerged that the two sides are close to making a deal which should be seen as positive for the commodity currencies including the Australian dollar. A future US trade deal which will remove all of the already imposed tariffs and barriers to trade should be seen as welcome news for the global economy. In turn this bodes well for the Australian dollar due to the large volume of exports of its commodities. When the global economy performs in theory so should the Australian dollar.

For more information on the Australian dollar and how these events have a direct impact on your own currency transfer then please feel free to contact me James at jll@currencies.co.uk and I will be happy to assist.

Will GBP vs AUD Strengthen if a Brexit Deal is Reached? (James Lovick)

The pound to Australian dollar exchange rate remains on a weaker footing as Brexit remains the main concern for sterling exchange rates. After a cabinet meeting yesterday plans are now being ramped up for a no deal Brexit which should keep rates for GBP vs AUD at the lower levels of this recent range.

Rates for GBP AUD are currently trading around 1.76 for the pair and any Brexit developments over these coming weeks will almost certainly impact on the rates. The meaningful vote to be held in parliament will be held in January and should become the main focus in the ongoing Brexit debacle. The outcome of that vote to be held before the 21st January will determine whether or not there will be a deal.

The important point to highlight is that the default option if parliament does not agree the deal will be to move to no deal which will fall on WTO rules. This prospect is the main reason why the pound is on the back foot and if it were to happen there is a strong likelihood that there will be some economic disruption and the pound would likely fall. The Bank of England suggested a drop in the pound of 25% in a worst case scenario. If however there is a change of heart in the negotiations and and wording on the Irish backstop was changed for example then there could be material gains for GBP AUD.

The US Federal Reserve will meet later today where an interest rate increase of 0.25% is widely expected which will take interest rates up to 2.5%. This is important for Australian dollar exchange rates too as the level at which interest rates are set in the US had a direct bearing on the strength of the Australian dollar and rates for GBP to AUD. US President Donald Trump has been trying to put pressure on the Fed to not raise interest rates but whether this has any bearing on policy remains to be seen.

Perhaps more likely will be that the rate hike goes ahead tonight as planned but there could be a softening in stance for further rate rises in the New Year. A rate hike in the US could see the Australian dollar weaken as investors move their funds to the higher yielding dollar. However if the Fed look set to pause its rate tightening cycle in 2019 then this could see the Australian dollar make some gains.

For more information on the Australian dollar and assistance in transferring funds whether buying or selling Australian dollars then please feel free to get in touch with 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

GBP AUD – Brexit Final Stages (James Lovick)

The pound has pushed higher against the Australian dollar with levels breaking over 1.83 for the GBP AUD pair.

Now that the conservative party conference is out of the way and the “Dancing Queen” Prime Minister reiterated her vision of leaving the EU, the conversation for these coming weeks will be dominated by Brexit. With movement in negotiations expected by the time of the next EU summit this month it will be a hugely interesting and volatile period for sterling exchange rates.

Ultimately the direction of the price of sterling will be dictated by the terms of Brexit and whether or not there is a deal. Whilst the expectation is that some sort of a deal will be reached the markets do not yet appear convinced this is the case. With growing support for a Canada style type trade deal which is supported by the likes of Boris Johnson there could be some major changes yet to play out in this negotiation. This is likely to be one of the most volatile periods ahead for GBP AUD and there are likely to be opportunities for those clients looking to buy Australian dollars. Similarly if the negotiations approach a no deal scenario then those looking to sell Australian dollars could see some better rates on the horizon.

The trade wars between the US and China continue to weigh heavy on the Australian dollar and it may only be a matter of time before new tariffs are introduced. Any escalation on this front is likely to weigh heavy on the Australian dollar due to its large volume of exports which go to China. A global slowdown would also carry inherent risk for the Aussie. The commodity currencies generally fare less well in time of global economic uncertainty.

For assistance in making transfers and help with the timing of an exchange then please feel free to contact me James at jll@currencies.co.uk

GBP AUD ahead of Conservative Party Conference (James Lovick)

The Australian dollar has come under a degree of pressure of late as trade war concerns continue to weigh heavy on the Aussie. The cooling property market down under with considerable falls seen in both Sydney and Melbourne are also attracting concerns from the Reserve Bank of Australia. While the markets are not expecting a property market crash bearing in mind the falls in house prices appear to be coming from two cities, the central bank will nonetheless be in no hurry to raise interest rates which could potentially slow growth.

Rates for GBP AUD are currently sitting at 1.8140 and the two biggest drivers for the pair will be Brexit and the ongoing US trade war with China. The Australian dollar is negatively impacted by the global uncertainty for a slowdown in global growth especially considering that China is such a major export market for Australia.

UK Prime Minister Theresa May was in New York yesterday speaking on Brexit as she tried to reassure business that a deal between Britain and the EU will be reached.

UK Gross Domestic Product figures are released tomorrow morning although the central focus in my opinion will be on the Conservative party conference this weekend. With so much to negotiate in these Brexit negotiations and the difficult task that Theresa May has in finding a deal that will work for the EU but also one that she can get through in parliament then there is considerable risk for the pound over these next two months.

An agreement is expected to be found although any clues as to whether the Chequers deal will fly or if another Canada type trade agreement takes preference will inevitably have a direct impact on the price of sterling exchange rates. With splits in the cabinet over a softer or harder Brexit then this conference in my opinion could give new direction for the price of sterling.

For assistance in transferring Australian dollars at the best exchange rates then please contact me James at jll@currencies.co.uk

Australian Dollar Poised for Volatility after US Tariffs are Enforced (James Lovick)

The Australian dollar is now set for a volatile period after US trade tariffs on Chinese goods kicked in this morning as planned. The Australian dollar as a commodity currency is likely to be sensitive to any further escalations in these trade wars and the dollar could come under considerable pressure. $34 billion worth of tariffs have been imposed as of today and China has already reciprocated. US President Donald Trump has signalled his intent to increase these tariffs to as much as a staggering $450 billion on Chinese products if China retaliated.

It will now be interesting to see the response from the US after this retaliation and where this heads next. The EU has also been embroiled into these trade disputes highlighting how big an issue this all is. If global economic growth falls in the future then the Australian dollar is likely to be one of the hardest hit.

GBP AUD

Today marks a hugely important today for those clients looking to buy or sell Australian dollars with pounds. British Prime Minister Theresa’s May will be holding a cabinet meeting at Chequers to finalise the detail on Brexit and how close Britain will be aligned to the EU. There has been much disagreement within her cabinet and today should give guidance as to whether Britain will pursue a soft or a hard Brexit. The pound is likely to react accordingly and this meeting does have the potential to cause some fireworks.

No details have yet been released but the outcome of today’s meeting will form the basis for a white paper on Brexit. A softer Brexit that maintains trade and one that is likely to be agreed by the EU is likely to see the pound rally. However any resignations or objections from within government could create even more uncertainty for sterling exchange rates. Clients would be wise to plan around this event as we could finally be at the tipping point.

For more information on the Australian dollar and for assistance in making transfers at the opportune time then please get in touch with me James at jll@currencies.co.uk

Buying Australian Dollars? GBP AUD Supported (James Lovick)

The Australian dollar remains under a fair amount of pressure amidst global economic and political changes. Rates for GBP AUD remain over 1.80 for the pair although a move higher to 1.90 may prove difficult in the short term. Those clients looking to buy Australian dollars with pounds may wish to consider locking in at today’s rates and take advantage of these higher levels which have only recently become available.

The pound has been boosted following slightly better manufacturing numbers released yesterday as per the Purchasing Managers Index. Tomorrows services sector data for the UK could prove particularly volatile for the pound and a strong number could see a rally in the GBP AUD pair.

The Australian dollar could also come under added pressure in the short term as a result of some of the trade barriers which are being erected by China and the US at present. If trade barriers and tariffs continue to go up then the Australian dollar could be one to suffer although the markets are hopeful this behaviour will not turn into a fully blown trade war.

Those clients who are looking to sell Australian dollars for pounds should continue to see more volatility in the coming weeks and months as result of the ongoing Brexit negotiations between Britain and the EU. One of the reasons the pound has rallied is due to the fact that the second round of negotiations has just been completed with talks now progressing on to future trade. Once the thorny issues of the Irish border and also whether financial services can be included in and trade deal have been resolved this could prove beneficial for sterling exchange rates.

For more information on the Australian dollar and how to maximise on the rates of exchange when there is sudden movement then please feel free to get in touch with me at jll@currencies.co.uk

Will GBP AUD Hit 1.80?

The Australian dollar has come under a wave of new pressure as a result of concerns of the possibility of future trade tariffs being imposed from US President Donald Trump. Whilst the commentary coming from the White House has softened slightly overnight by suggesting that tariffs would only affect certain countries the uncertainty is still there and this is having a negative impact on the Aussie. There is a possibility of a trade war which could be damaging for the commodity currencies in particular which include the Australian and New Zealand dollars. You only need to look at how the Canadian dollar has been hammered over these developments to realise that the Aussie could weaken further. Any changes or policy implementations are likely to see the Australian dollar weaken and a move to 1.80 credible.

Selling Australian dollars

Those clients looking to sell Australian dollars for pounds are currently seeing some weaker levels with rates closer to 1.80 rather than 1.70 for the GBP AUD pair. Any opportunities for selling dollars are likely to stem from developments in the Brexit negotiations which remains the single biggest driver for sterling exchange rates. The hot potato of the moment is whether or not financial services will be included in any future trade deal between Britain and the EU. So far and the response from the EU has been frosty with the French finance Minister Bruno Le Maire stating that there is little chance of a trade deal being included in the deal.

Whilst this uncertainty continues should mean some good opportunities for clients looking to sell Australian dollars. Any developments could see the pound weaken although I would be mindful that as talks move forward in the coming weeks the pound could start to rally if compromises between both sides are made. The pound remains weak against the majority of currencies as a result of Brexit and so clients may wish to consider moving sooner rather than later to take advantage of what are still attractive levels. My view is that it is only a matter of time before the pound rallies and potentially quite considerably. For assistance in trying to time your exchange the please get in contact.

For more information on the Australian dollar and how the markets movements are likely to impact on your own currency requirement then please feel free to email me at jll@currencies.co.uk