What next for the Aussie?

Pound Pushes Higher Against the Australian Dollar on Recent Economic Divergence

GBPAUD rates have improved even further for AUD sellers as uncertainty over the UK economy combines with improvements in the Australian economy. This is presenting tough choices for AUD buyers with pounds, in short if you have a transfer buying AUD with sterling I would not be holding on for big improvements. It would appear very likely this trend will only continue in the coming weeks and months particularly with the EU Referendum just around the corner!

The Australian dollar is benefiting from a range of factors. Firstly Chinese economic data has improved in some important areas, notably house prices. To make houses China needs Iron Ore, one of Australia’s key exports. This has led to a surge in Iron Ore prices of over 20% last week! This has removed the immediate need for an interest rate hike and with the Federal Reserve highlighting global concerns as a reason to only raise interest rates twice this year rather the predicted four, investors selling off USD have been buying AUD as it offers a higher yield because of the higher interest rates on offer in Australia.

If you are buying AUD there will of course be spikes to take advantage of  which I will happily point out to you but there is a stronger likelihood in my opinion rates will become much worse. For more information on the latest news to impact your exchange rate please contact me Jonathan on jmw@currencies.co.uk