AUD continues to put pressure on weak pound

Pound Pushes Higher Against the Australian Dollar on Recent Economic Divergence

As it looks likely a resolution will be achieved in Europe (or at least the markets believe so) investors have had some courage to put funds in the Australian dollar causing further strength on AUDGBP. With the possibility of QE (Quantitative Easing) tomorrow for the UK, things could move yet further in favour of anyone selling the Aussie.

As we head closer to the mid 1.40’s I just cannot see how the Aussie will weaken anytime soon. All of the indicators we have discussed for the last month are working in favour of the Aussie on the rate. If you are holding out for some movement on GBPAUD or AUD against any currency these are the things to be aware of.

Tomorrow 09:30am –UK Manufacturing and Industrial Production data along with Trade balance figures for the U.K This may throw anything up, production figures have not been too bad of late however as per usual with the U.K as soon as things seem on the up we tend to get figures that come out that knock us straight back down again, so be very wary of this one.

Tomorrow 12:00 – Bank of England Interest Rate Decision  No change in rates is expected however there is continuing speculation regarding further Quantitative Easing. Regular traders will be aware that any mention of QE tends to weaken the Pound so should we see this tomorrow then we may see Sterling weakness against all major currencies

Tomorrow 12:45pm – European Central Bank Interest Rate decision There is a slight chance of a rate cut in the Eurozone tomorrow however most major analysts expect the ECB to hold off for the time being. Key will be the press conference following the speech which may suggest how the ECB are planning to attack the crisis going forward.

On-going yet imminent: Greek debt agreement  Signs are this is now close to being tied up and signed off, in past months whenever an agreement/resolution (no matter how little I believe most think it will work) is put into place, investor’s confidence in the riskier assets rises and in turn the Aussie tends to strengthen. By the sound of it the agreement may be finally signed off on the weekend by Greek Parliament however anything may happen in the meantime.

If you are considering any currency transactions why not speak to us to ensure you are getting the very best deal. You can contact me on jmw@currencies.co.uk