GBP/AUD rates have dropped by over 5 cents form high to low during Monday’s trading, which is the most aggressive drop we’ve seen for the Pound in the past 6 years!
Sterling has come under huge pressure throughout Monday’s trading, following a tense weekend in Brussels for David Cameron and the subsequent breakdown in Parliament, regarding our future participation in the EU. Regardless of your arguments for or against this, what is clear is that the market uncertainty it has caused had a hugely detrimental effect on Sterling’s value.
We’ve seen the Pound lose value against all of the major currencies and I now feel GBP will struggle to break back through 2, unless we see a major shift in current market sentiment. We already saw GBP come under pressure due to the Bank of England (BoE) changing its stance on the UK economic recovery and with them actively talking down facets of the economy, I don’t anticipate the current trend to change in the short-term.
The one piece of silver lining for those clients holding Sterling is that the Australian economy will continue to be handicapped by the economic problems in China and in fact if you look at the history on the pair, particular in recent years, the current levels still look very attractive. My opinion is that the highs of last year are now gone and I would look to protect any short-term positions and not gamble on this extremely volatile and unnerving market.
If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 787 478 and ask one of the reception team for Matt. Alternatively, I can be emailed directly on [email protected]