To the dismay of many and the joy of the others the Aussie has been one of the biggest losers this year. The high to low is an incredible 30 cents difference. On a $500,000 AUD transfer this make a difference of £59113.30!
This just shows how important the actual timing of your transaction is when moving money internationally. If you are buying or selling Australian dollars there are some key events to take note of, the trend to me would appear to be further AUD weakness.
– Federal Reserve Tapering – The US Federal Reserve Bank has kept the Aussie well supported with the surprise news the US will keep the QE flowing. This encourages investors to take up riskier positions on commodities and assets that benefit when the global economic mood is optimistic. As Australia’s economic strength is linked to global demand of their natural resources, the Aussie has benefited from signs QE will keep flowing which will keep global demand high.
BUT… the Federal Reserve have said they will taper at some point once the US economy is strong enough. There is no timescale on this occurring but when it does happen it will surely lead to Aussie weakness as investors reconsider where to position their funds.
– Australian Interest Rate decision – Weaker than expected Unemployment has led some to assume further RBA cuts are on the horizon. This will surely also lead to AUD weakness too!
All in all a strong pound and euro will make it much harder for AUD sellers too. For a free, no obligation discussion of where rates may be headed please speak with me Jonathan directly on [email protected]