Trends for GBP/AUD continued in favour of the AUD as the fiscal cliff seems to have given confidence to investors and a drive towards higher yielding currencies such as the Australian Dollar has been seen. Throughout the course of the trading day yesterday the pound lost over 1% against the Aussie, a trend I think is likely to continue today. Longer term, however, I am still confident that the underlining problems facing the Australian economy influenced by a falling mining sector and fall in demand from China will lead to the market price moving towards 1.60 in the short to medium term. We also may see future interest rate cuts from the Reserve Bank of Australia that may also keep longer term pressure on AUD. For anyone selling dollars the current levels to me represent a strong opportunity.
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