Following further speculation by traders of another interest rate drop in Australia rates have climbed further. GBPAUD rates have climbed over 10% in the last 30 days breaking 1.60. This threshold has also meant that investments in Australia are no longer returning the rewards they once were. In most cases returns have dropped by almost 50% in a month which has resulted in a sell of the Australian Dollar, it is this sell off which has made the dollar continue to weaken. It has now reached a high of nearly 1.63!
So what next for the GBPAUD rate?
Well even though many speculated that 1.60 would happen, the speed that it has continued to raise over this limit really suggests it may continue to climb. It looks like we could see 1.65 within the next week and potentially on to 1.70 within the next month. The only thing that could really slow or even stop this climb is the potential of pound weakness coming from any further Quantitative Easing (QE) being announced. It will simply be a race between the two economies; if you think that the UK will do QE before a cut in Australia I would suggest GBPAUD buyers to move either before the banks release later today, or before their decision next month. If you are on the other side, and think that Australia could lower their interest rates sooner, simply wait.
If you are in the unfortunate situation of selling AUD and buying sterling, the opposite would be true. In either situation the facts still remain:
- We will only know when the spikes finish when the rates get worse
- Rates do not move in a straight line.
With that in mind our proactive service here is well placed to help, with the use of specific tools including Limit orders, stop loss orders, forward contract and short forwards we can help you limit your exposure and maximise your trade. PLUS with access to award winning exchange rates we can also happily say that we are 100% sure we will be able to save you money on your transfer. So if you are in the situation looking at moving money internationally, entering the currency market or trading the Australian Dollar please get in contact. We can quickly provide you with a live quotation and live price, plus give you our current forecasts to help you buy at peaks. Please email me, Steve Eakins for more information my email address is [email protected]