Sterling vs Australian Dollar exchange rates have ended the week on a high breaking past 1.90 on the Interbank level after falling to the 1.86s midweek following the lacklustre UK Budget Statement.
On Wednesday UK Chancellor George Osborne had cut the UK’s growth forecast from 2.4% to 2% which had caused huge losses for Sterling exchange rates across the board.
However, the Bank of England have changed their stance and although all members wanted to keep interest rates on hold they did suggest that the next change for interest rates could see a hike instead of a rate cut. This has cause Sterling to rally pas 1.90.
Turning the focus to Australia the Reserve Bank of Australia have said that the property sector is not the only risk for the Australian economy.
The RBA head of financial stability Luci Ellis said this week that the RBA are not just monitoring the housing market but also the whole economy.
Household debt down under has also been rising which is causing alarm for the RBA and in time this could fuel an interest rate cut leading to Australian Dollar weakness in the longer term.
GBPAUD rates hit their lowest level for 12 months earlier this week but have now seen a strong recovery and in my opinion further Sterling strength to come.
On Tuesday morning Australia releases their latest Housing Price Index and with such a disparity between Western Australia, Sydney and Melbourne I think this could cause Australian Dollar weakness vs Sterling.
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 protected]