Australian Dollar has opened this morning in a very similar position to close of trading yesterday – testing the 1.80 barrier. This is primarily due to the weak Pound following Wednesdays Inflation statement.
Bank of England governor Mark Carney confirmed on Wednesday that UK interest rates would not be increased until late 2015. With Inflation down to near 1%, Carney has had the decision taken away as to when to recommend the rate hike – the UK General Election and months prior are no time to change the 0.5% rate. Sentiment on trading floors has gone from strong support for Sterling growth to a feeling that ‘Any positive news is to be short lived, as the Pound will just be talked back down again’.
On the Australian side of things, commodities have had a quiet week and have not impacted GBP AUD a huge amount. The Reserve Bank of Australia have also been quiet, with the next release of note (Reserve Bank of Australia Interest Rate meeting minutes) due out at half past midnight on Tuesday next week.
My opinion is that we have a selling window for the Australian Dollar – the market has nudged in to the 1.79s at time of typing. I think buyers should target buying at closer to the 1.85 if the rate presents itself within your set timescale.
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