The Australian Dollar has been on a run against the pound with the AUD strengthening by around 2% in the space of two working days. The main reason for the strength is more than likely down to comments from the Bank of England during their quarterly inflation. Governor Mark Carney stated: There is still “a lot of uncertainties to contend with in the UK economy” given record participation in the jobs market, “remarkably weak” wage rises and a rising number of threats to the global economy.
The report also slashed its wage growth forecast from 2.5% to 1.25% which is why the markets have now pushed back expectations on an interest rate rise from November this year to February next year. All has led to the pound significantly weakening against a host of teh major currencies. Carney also said that the strength of the pound has been hurting UK businesses exports and has to be addressed.
So the news out of the central bank has meant now is a prime time to capitalise on the AUD gains and the current rates below 1.80 is very attractive. After the rate has been well above 1.80 for some time there is teh chance this rate may continue to move in Aussie Dollar sellers favour but if you do not really want to take much risk now represents a good time to convert your funds into Sterling.
Down under it has been a fairly quiet week data wise. Apart from some positive house price data there has not been much to shout about of late. Next week there will be a speech by the RBA Governor Glenn Stevens which if he gives some insight into future policy the AUD could be volatile. if he states that they are happy with their current monetary policy and gives a speech similar to his KIWI counterpart (no further rate hikes this year) then the AUD may just weaken off a little.
If you are looking at buying or selling the Aussie Dollar then I would recommend speaking with us to see if we can help make you a saving over your bank in the UK and Australia. Regularly we help our clients save an average of 2% over the banks and when you are exchanging thousands of Dollars the savings really add up. If you would like more information on the currency service we can offer please do feel free to email myself Ben Amrany at [email protected]
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