The GBP AUD pair has moved very much in favour of GBP holders today, as this morning Mark Carney of the Bank of England was very ‘bullish’ (positive). Carney was speaking on monetary policy in Frankfurt and indicated that the next interest rate for the UK would be positive. This provided Sterling the unexpected boost seen and pushed rates back in to the early 1.90s
The short to medium term outlook for GBP AUD is a very tricky one to call, as both sides of the currency pair have big announcements.
The Australian Interest Rate decision has previously enabled AUD buyers to achieve rates in excess of 2.0, and I personally feel that there will be another cut before the end of quarter 2. This would see AUD weaken substantially and depending on the strength of the Pound – could enable the 2.0 mark again.
The Sterling side has the impending UK General Election and yesterday evening proceedings kicked off. Cameron vs Miliband was watched all across the UK with analysts having Miliband a hairs breadth ahead of Cameron. The Election build up will spell substantial GBP volatility as realistically there will be a hung parliament.
If you are buying AUD, I’d be inclined to BUY sooner rather than later. The Election in the UK is a much more guaranteed outcome of currency impact so not worth risking!
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Have a good weekend – will the Aussies win the Cricket in their own backyard???