The Aussie Dollar has strengthened despite RBA Governor Glenn Stevens calling for more financial control in the banking sector. The Aussie has done well of late as investors once again move into the AUD for greater returns following the RBA statements that no more rate cuts were likely. This has been reinforced by cautious comments by the Bank of England, The Federal Reserve, and the rate cut by the ECB, meaning both the pound, the Dollar, and the Euro in particular are unlikely to offer big returns any time soon.
However this is not to say sterling will be on the side. Most UK data of late has been pretty good with the only real exception being the increasing national deficit. We have more UK jobs news on Wednesday, as well as Industrial production figures tomorrow and the unofficial NIESR GDP estimates. If all of these are reasonable then expect the pound to see some support, particularly in Aussie and Chinese data out in a few hours is disappointing.
Whilst the tone for the Aussie has strengthened, I still feel the RBA will not want to see the currency appreciating too much and I expect the Aussie to yo-yo around the 1.80 mark as UK and Aussie data sea-saw. To this end I still think stop loss and limit orders will be the way to approach the currency pair in the coming weeks until a more definite trend emerges. If you need to make a currency transfer, and particularly if you wish to buy or sell Australian Dollars, then feel free to email Colm at [email protected]