THE Australian dollar has weakened slightly over night here in the UK after Australia posted its widest trade deficit in nearly five years. The trade balance is the difference in the value of its imports and exports of Australian goods. Export data can give an important reflection of Australian growth, while imports provide an indication of
domestic demand. Trade Balance gives an early indication of the net export performance. If a steady demand in exchange for Australian exports is seen,
that would turn into a positive growth in the trade balance, and that should be
positive for the AUD.
The trade deficit for November widened to $2.6 billion from $2.4bn in October, the Australian Bureau of Statistics said. That was the biggest monthly shortfall since March 2008 and was wider than analysts’ expectations for a deficit of $2.3bn.
Although the Aussie has slightly weakened against a range of currencies the losses could have been more severe than what was witnessed. GBP/AUD is currently trading at 1.5325. Over the festive period the pound was up at over 1.56 so we have recently seen a decline for the pound v Aussie Dollar of around 2%. If you were making a £200K purchase of AUD you would now achieve 6260 AUD less than at Christmas.
For those that are buying the Aussie Dollar In the near future I would not hold out for levels of 1.60 as it is extremely unlikely that this will occur in the near term. In fact with the gloomy outlook for the UK economy we are more likely to weaken further to 1.50. The Aussie Dollar has had a habit in the last few years of significantly strengthening against a range of currencies which has hurt many of my clients that were emigrating down under.
If you are planning on moving to Australia or have an exchange to make in the near future I will be happy to liaise with you to explain all the options that are available to you in connection with your money exchange. The rates that we offer clients can be up to 4% better than the banks so the savings can be extremely significant. Please feel free to contact me at [email protected] and I will contact you to discuss things going forward.