The Australian Dollar vs Sterling has felt the benefit of a Japanese interest rate cut this week as the negative rate means carry trading which involves money going out of Japan in search of higher yields including the Australian Dollar.
This has seen Australian Dollar rates vs Sterling at their strongest level since May 2015 with GBPAUD rates hitting below 2 during Friday’s trading session.
On Tuesday the Reserve Bank of Australia meets to discuss interest rates and if they keep the policy the same of keeping rates on hold I think this could result in more Australian Dollar strength.
I do expect the RBA to cut rates during 2016 but I don’t think will happen for some time so next week I expect GBPAUD rates to drop below 2 again providing some excellent opportunities to sell AUD into Sterling.
Wednesday sees the release of Australian Trade Balance and Export figures which could see a small recovery for Sterling vs the AUD if the figures show a fall owing to the slowdown in China.
However, overall I expect GBPAUD rates to fall below 2 again during the week.
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@example.com