GBP/AUD When to Trade over the Festive Period (Daniel Johnson)

Australian Dollar Forecast: Why is the AUDGBP Rate Falling?

There is little data of consequence released until the new year so you would expect to see little movement for GBP/AUD. However due to the distinct lack of commercial trades over this period there can be big swings in the market and it is extremely difficult to predict which way it is going to go. It is key to stay in touch with your broker during these volatile times in order to maximise your trade if you have to move short term.

The Reserve Bank of Australia has indicated there will be no drop in interest rates until at least February. I would not expect GBP/AUD to break more than 2.12 up until this point. Moving forward I feel Australia is too heavily reliant on raw material exports to China, China’s growth is slowing and if China sneezes the rest of the world catches a cold. We saw this first hand on “Black Monday”.

There is also a house pricing bubble to worry about, it is bordering on unsustainable.  When you take these factors into account I think there could be a rocky road ahead for AUD.

When Should I Trade?

AUD Seller – If you are selling AUD I would look to move now, GBP/AUD currently sits at 2.04 and these are some of the best trading levels for months and as I mentioned earlier I do expect Sterling to rally.

AUD Buyer – If you have to move short term, keep your eyes glued to the market over the festive period. There could well be a spike in your favour which could be one of the few opportune moments between now and the second quarter.

If you are an AUD buyer with a medium to long term requirement, I would be tempted to hang on, I think we could see movement in your favour towards the End of February. But I would set realistic expectations, I wouldn’t try and hold on further than 2.15, I think to procrastinate for small gains could prove costly.

If you have a currency requirement I will be happy to assist, I would strongly suggest getting in touch with me if you are looking to trade. If you would like to contact me please call on 01494 787478 and ask for Daniel Johnson or  e-mail me on dcj@currencies.co.uk .  I consistently provide the best rates of exchange available in the market and I can guarantee to beat any competitors rates. I will be more than happy to provide a free quote. Thank you for reading my blog I really appreciate it and I look forward to hearing from you.