Aussie Volatility on Fed possibility for December hike

Will AUD to USD Retest the All-Time Lows?

A Key driver on the Australian dollar has been the likelihood (or unlikelihood) of the US Federal Reserve raising the US interest rate. With this looming prospect has come AUD weakness as investors who have spent years holding the much higher yielding Aussie realise that the longer term forecast no longer supports the Australian dollar and that a conversion to a better yielding currency longer term is sensible. I feel therefore if you need to sell AUD in the future putting some plans in place sooner rather than later is sensible since it appears the hey day for the antipodean currency is passed!

All in all the unwinding of positions held on the Aussie look set to continue as investors seek to longer term higher yields and the US dollar (and even sterling) are looking like much better longer term bets. Even though Australia has a higher interest rate currently by the time the US or UK do rise so many other investors will have pulled out that the currency will be at much lower levels. If therefore you need to sell the AUD in the future why take the risk of exchange rates moving against you?

By working with a specialist currency broker like myself you can get a deeper understanding of the market and receive assistance as to the best strategy and options to make your currency exchange as profitable as possible. For more information please email me Jonathan on jmw@currencies.co.uk