During the last month Sterling vs Australian Dollar exchange rates have moved by over 5% from the high to low.
With the UK GDP figures for the previous quarter having been downgraded from 2.6% to 2.4% a fortnight ago and inflation measuring below 0% for the second time since 1960 the UK economy has showed signs os slowing down.
However, although exchange rates for GBPAUD have been reflecting this data recently the good news for anyone holding Sterling is that UK unemployment came out a lot better than expected at just 5.4% which stopped the recent falls for Sterling.
To me the Australian economy is still on the verge of a big slowdown and a recent article published in the Sydney Morning Herald shows that the auction market to buy homes in Sydney has seen its worst week in three years.
With the RBA having earlier this year claimed they are worried about the Sydney property market to me it is a bubble waiting to burst.
Indeed, with the Sydney market showing 4.9% growth during the last quarter this is clearly unsustainable and if this starts to slow it is simply a matter of time before the RBA looks at cutting interest rates.
Therefore, any hints of a rate cut in the meeting minutes due on Tuesday could see Australian Dollar weakness.
If you have a currency transfer to make and want to save money on exchange rates compared to using your own bank then contact me directly for a free quote. Tom Holian [email protected]