The EU deal announced very late on Friday afternoon saw some of the recent lost buying power for the Pound make its way back into buying rates for the Australian Dollar, with central levels back above 2.01 on GBP/AUD buying rates.
The movements however were only marginal. The news of of a provisional deal only came out after 9pm UK time, and the only markets still open before the weekend to trade on the news were in North America, which were only active for another hour.
We will likely see a delayed reaction until Monday morning. But it may not be more of the same positive movements for Australian Dollar buyers.
The only news currency markets had to hand in order to judge the value of the Pound at the time when rates improved was that a deal had finally been reached. Any progress to keep the UK in the EU is seen as positive for the Pound, as financial markets rarely react well to changes in the status quo.
To give readers an idea of the seriousness of the situation, the consensus among analysts at UK banks is that a Brexit will cause the value of the Pound to eventually fall by 20%. A very realistic expectation given that the run up to the 2014 Scottish Referendum saw Sterling drop by a total of 8% when polls were close.
A host of developments have occurred since the initial reaction. Five members of Cameron’s Cabinet have moved against him and joined the ‘Leave’ campaign, and initial polls following the announcement show that the race will be incredibly tight in the run-up to June 23rd.
I believe the call for an early Referendum by Cameron will be enough to imbue further strength into the Pound, but with a cloud of anxiety expected to surround Sterling until June, this will likely be a short-term bump rather than the establishment of any long-term trend for Australian Dollar buyers to enjoy.
I strongly recommend that anyone with an Australian Dollar buying requirement in the short to medium term (3 months) should contact me on [email protected] to discuss a strategy for your transfer in order to maximise your Australian Dollar return.
If you outline your requirements and the time-scales you have to work with to complete your transfer, I can reply personally on Monday morning after initial market reactions are posted, and revised forecasts for GBP/AUD rates of exchange are refined, and give you the information you need to make an informed decision concerning your transfer.
I have never had an issue beating the rates of exchange offered elsewhere, and any improvements for Australian Dollar buying rates noted at the start of next week can be fixed to avoid any corrections as we approach closer to the June deadline making your currency purchase more expensive. 01494 787 478 – Joshua Privett