With GBPAUD exchange rates hitting their highest level yesterday since July 2010 it appears to be a very tempting time to buy Australian Dollars. Interbank levels are testing 1.80 but not quite breaking through as yet owing to the large resistance barrier we are seeing at these levels. The Reserve Bank of Australia Deputy Governor Philip Lowe has said that he expects to see a weaker dollar going forward with a hint of monetary intervention if interest rate cuts don’t help to re-balance the economy.
The exchange rate for GBPAUD has already improved by 24% since March owing to this year’s interest rate cuts and the slowdown in GDP in China. As Australia’s largest trading partner China’s growth has a large impact on the strength (or lack of it at the moment) on the Aussie Dollar.
Steady UK GDP figures published yesterday morning showed revised growth at 0.8% which was the same as the consensus which again led to Sterling strength across the board. With an interest rate cut earlier this month in Europe and potentially another one coming global investors are seemingly concerned about having funds in riskier currencies which would include the Australian Dollar.
The Bank of England releases its Financial Stability Report which looks at the stability of the financial sector at the time of writing. It will include any suggested policies aimed at reduce risks to stability one of which concerning the economy is the rampant UK housing market, which saw its quickest rise in 3 years.
Mark Carney will also be talking at 1030am this morning and my personal feeling is that we could see some mildly negative comments as I feel he could be concerned that the Pound has increased a little too much during this month.
For a free quote when buying Australian Dollars email me directly Tom Holian [email protected]