GBPAUD touches 1.50, where now for the pair?

AUD GBP Sees First Positive Trading Day in a Week

GBPAUD has finally creeped back up to the best levels seen since February 2013. The surge higher was all on the back of better than expected GDP data for the UK. This begs the question where now for the GBPAUD pair?

I expect the rate will come back lower below 1.50 as the economic conditions for the UK remain weak. Having said that as we get new economic data out for the UK early next month we will see the pound react. Investors will want to know whether the latest data is indicative of sustained economic growth or if there is still inherent underlying weakness for the pound.

Regarding the Australian side even lower interest rates failed to weaken the currency and the prospects remain very good for China and the global economy. China may have wobbled slightly but it is unlikely it will crash. If the UK economy and US economy are growing, this should ensure growth in China, although the Eurozone situation is worrying. China does a lot of trade with Europe and if there is a prolonged recession it will affect Chinese growth which will weigh on the AUD.

These trends may take many years to manifest but are worth being aware of. If you have a transaction to consider I suggest being aware of all of your options. We offer the option to forward buy currency which means you can fix today’s rate now for a future date. For more information on how our service works, please feel free to contact me Jonathan directly on [email protected]