Sterling exchange rates have rallied at the start of the trading week peaking just shy of 1.56 yesterday – bringing gains close to 3 cents since the start of the week. Movements appears to be as a result of AUD weakness as opposed to GBP strength following news that the central bank in Australia will consider further monetary easing in the months to come. This could well lead to continuation of the current trend and a move towards 1.60, although those buying AUD in the short term watch out for the Bank of England minutes this morning at 09:30. These minutes will give insight as to what the Monetary Policy Committee has in store with regards to monetary stimulus. The main aspect to look for is whether more QE was discussed – if this was then I would expect to see a fall in the value of GBP. Personally I think QE is on their minds but possibly not before Christmas and as a result I think the minutes are unlikely to cause too much negativity and I would expect to see GBP/AUD push towards 1.56 and beyond.
Should you have a need to buy or sell AUD, whether it be to GBP, EUR or any major currency and you would like to discuss the current market trends and forecasts then please do feel free to contact me. I personally feel the AUD will continue to fall against a host of currencies due to a number of factors (potential monetary easing as discussed above), a fall in commodity prices, and also the falling out put form Australia’s main importer – China. Factors here suggest a period of sustained dollar weakness, gpotentially good news for some as the dollar has been strong for so long.
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