Sterling received a major boost yesterday, following a bullish Autumn Statement by Chancellor George Osborne. He raised growth forecasts for 2015 and beyond and despite some reservations regarding his aggressive spending cuts, the markets reacted positively pushing GBP/AUD rates back through 1.86.
For a time it seemed as if the AUD was going to build some positive momentum against GBP, with rates creeping back towards 1.80 last month but these latest developments mean in my opinion it is likely we will see GBP/AUD hit 1.90 by the first quarter of 2015.
The Bank of England are still likely to want to control Sterling’s value, as there are on-going concerns that the Pound is gaining too much value, which is ultimately hurting our export industry. However, the Reserve Bank of Australia’s (RBA) commitment to weakening the AUD is stronger than that of the BoE and with China’s demand for Australia’s raw materials slowing, it is likely the Australian economy could face further smuggles as we head into next year.
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