The Australian Dollar has been on a roller coaster ride since the RBA decided to cut interest rates last week. After the decision we witnessed the Aussie weaken against a range of currencies and there have since been rumours that the RBA may look at cutting rates once more next month to help curb the strengthening AUD.
Today we have seen that even a cut in the base rate of interest is not enough to halt the currency strengthening. As soon as positive data comes out of Australia it seems that the rates increase quite significantly. Better than expected jobs figures from down under have undermined the RBA’s efforts to weaken the strengthening Australian dollar. The jobless rate came in down from 5.6 to 5.5 per cent sending the Aussie to higher levels against the USD since before the interest rate cut. Against sterling the rate is still hovering at 1.52 which is actually significantly higher than the lows of 1.43 a few weeks ago.
The concerning thing for anyone who needs to buy the Aussie Dollar is that over the last year and a half the RBA have cut rates by 2% and the currency has still strengthened. This is a sign of the times that even with the historic low interest rates the Aussie is still stronger than most of its trading partners. If you are hoping that the RBA may cut again in June and that the pound will push on to 1.60 or even 1.70 I personally would not hold out for this. This month has shown that when they cut rates purely to try and spur growth the exchange rate has a habit of strengthening once more.
If you do need to move funds into or out of the Aussie Dollar please feel free to contact me Ben Amrany at [email protected] and I can explain the options that are available to you. We offer a very personal service to help you maximise your exchange while offering savings of up to 4% over the high street banks.