The GBPAUD exchange rate has broken through 1.55 again today as Sterling continues to improve against many major and minor currencies. The Reserve Bank of Australia left the interest rate unchanged as the majority expected and with no stimulus this has seen a movement away for the AUD into safe haven currencies including both the GBP and USD. Looking to the US for guidance I think Ben Bernanke during the Jackson Hole summit has left the door open for QE3 which could mean further sell offs of riskier currencies. Following the announcement of the RBA to keep interest rates on hold the monetary policy statement missed off a few key bits of information. There was little or no indication of any further monetary policy, no reference of the problems of a strong currency and three no reference to the falling prices of iron ore and other natural resources. It is clear in recent memory that the Australian economy and in particular its currency rates has strengthened owing to the mining industry and the relationship between China and Australia so with a slowdown in China and a drop in prices of natural resources this could have a negative impact on the Australian Dollar meaning good buying opportunities if you need to transfer Australian Dollars.
Australian interest rates currently sit at 3.5% the highest available in western economies and there is no sign whether the RBA will plan to move rates over the next few months as I believe they are still trying to work out if the rate cuts between Novemebr and June have has their desired effects. The events in Europe will continue to dominate the headlines over the next few months and if we see the Euro stabilise we could see a weakening of AUD but if we see further cracks it could see a strengthening of the Australian Dollar.
For further information and how to save money when transferring currency feel free to email me Tom Holian [email protected]