GBP/AUD exchange rates moved back through 2 at today’s high, providing some of the best buying levels of the past 5 years. The Pound has benefited two fold over recent months, with an improvement in UK data and growth forecasts without doubt providing the catalyst for GBP’s recent momentum but also the slowdown in China’s economy (Australia’s largest trade partner) and the Reserve Bank of Australia’s (RBA) commitment to lowering the value of the AUD in order to boost exports.
Australia’s economy is so heavily reliant on the export of its vast supplies of raw materials that any slowdown in this sector will inevitably have a negative effect on AUD exchange rates.
With little data of note out for Australia before the weekend any further spikes are likely to be based on outside variables, so anyone with an AUD requirement should be keeping a close eye on the US Inflation & GDP data out tomorrow. Due to the global weight the USD holds, any major spikes for the greenback is likely to have an knock on effect for more volatile currencies like the AUD.
Personally I feel the AUD will find support around the current levels and recent history on the pair do not indicate a major shift market sentiment or stance, so from this standpoint I would certainly be considering my position around the current levels if I had an upcoming AUD purchase to make.
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