The Aussie dollar has weakened slightly due to the Inflation figures. I expect the market will continue to be favourable for AUD buyers, but I wouldn’t advocate taking a risk!
The market has just lately improved after some recent losses but I would not expect this will continue longer term. The previous forecast had really focused on the RBA (Reserve Bank Australia) cutting interest rates further but they had earlier this year removed this bias to cutting interest rates, hence the increase in the strength of the AUD. Despite some deterioration in the economic outlook in China Unemployment fell and I think that is a very strong indicator of how the Australian economy is performing.
The pound is performing well against most currencies but it is really all based on the prospect of the UK raising interest rates in 2015. We have seen recently the pound is very susceptible to bad news and in the absence of any truly outstanding and unexpected economic data the pound is unlikely to climb massively higher.
In this low interest world investors are searching for high returns and the Australian dollar is one of the highest yielding currencies around. 80% of currency transactions are speculative, i.e investors moving money around to make a profit. I think it therefore likely over the course of the next few months if Australian economic data continues to impress, the Aussie could find further favour.
You are currently 3 cents above the 6 month low and this level represents well over a 3 year high to buy the Australian dollar with sterling. I think therefore current rates should not be easily dismissed in the hope of much better levels.
Please contact me Jonathan Watson on [email protected] for the best rates!