We have already seen big falls for GBPAUD rates during the last few months with exchange rates over 30 cents lower than they were at their highest point back in December.
Sterling has had an extremely difficult period against all major currencies and in particular against the Australian Dollar.
Whilst the Eurozone has cut interest rates to 0%, printed another EUR20bn per month and the UK keeping interest rates on hold for the foreseeable future the Australian Dollar with a much higher yield has been the real benefactor as of late.
The EU referendum is just less than 3 months away now and this has caused investor confidence in the Pound to drop as the uncertainty of whether the UK will look at leaving the European Union has meant that overseas investment in the Pound has been significantly reduced.
The ‘Leave’ campaign for the UK has also gathered momentum during the last month.
Although the Chinese economy has also started to falter during this period this would typically weaken the Australian Dollar as China is their biggest trading partner.
However, the plight of China also goes to highlight the global slowdown and reinforces the problems that the UK is facing.
Chancellor George Osborne recently downgraded the UK’s economic growth forecast for 2016 from 2.4% to 2% and with Retail Sales much lower than expected last week Sterling has really struggled as of late.
On Thursday UK GDP data is published and if we see a revision lower we could see GBPAUD rates fall further towards the end of next week.
Therefore, if you need to buy Australian Dollars during the next few weeks you may wish to buy a forward contract which allows you to fix an exchange rate for a future date.
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]