RBA Interest rate left unchanged

AUDGBP Bounces as Australia Deals with Floods

Australian Dollar Forecast Exchange rate information Best Rates GBP to AUD Buying Australian Dollars or Selling Australian Dollars

The Reserve Bank of Australia left interest rates on hold at 3.5% overnight which as discussed yesterday was not much of a surprise. We were expecting interest rates to remain unchanged but there is some speculation that rates could be cut later this year to stop the recent Australian Dollar strength. With the Aussie Dollar trading at around 1.53 this morning the problem it creates is that for the economy excluding the mining industry is that Australian goods and services become too expensive therefore potentially having a harmful effect on the Australian economy. Over the last two months Sterling vs Australian Dollar has dropped by around 9 cents and the AUD has also gained against most other majors too. If interest rates are cut later this year we may see a small rise for the Pound against the AUD.

The UK releases its own interest rate decision on Thursday with some anticipation of further Quantitative Easing. I feel that if we do see more QE we could see some weakness for the Pound creating some excellent selling opportunities for the AUDGBP. The summit in Europe last week has helped the AUD gain against Sterling and Euro and if Europe continues to show solidarity we could see gains for the AUD.

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