Buying the AUD has become increasingly more expensive over the last 3 months with rates dropping by over 11%. A £200,000 purchase of Australian Dollars now gets you over $48,000 less than at the end of January. Worrying time for anyone with a purchase as this clear negative trend, I am afraid to say, is widely expected to continue.
China’s economic slowdown seems to be less of a worry for traders, the Australian Economy is showing less concerns of contraction, plus the uncertainty in the UK about its membership with the EU are all pointing towards GBPAUD rates continuing to fall.
Yesterday they New Motor Sales Figures were released in Australia and showed a positive improvement from the previous month, which further points towards this view that their economy is getting best.
Even this morning we had confirmation from the Reserve bank of Australia that they were not going to change central bank policy this month. Yes there are concerns that the recent strength of the AUD may hinder the recent boost in the economy in Australia but it rather unlikely that the RBA will change their mind so quickly, remembering that only 3 months ago they were talking about cutting interest rates.
The biggest challenge for the economy has been the fall in oil prices and the concerns out of china, this seems to have resulted in the interest rates in Australian to stay steady at its current level of 2% until at least next year.
We will get further confirmation about the health of the economy ‘down under’ this afternoon when the bank speaks. Also expect commentary following the fall in unemployment which was announced last week, a drop to 5.7% in March, the lowest level seen since September 2013.
This is certainly something for people that are looking to buy should avoid. You have to have a very strong argument to think that rates for GBPAUD will climb again, the market forecasts for further weakness are frankly so strong.
As such I strongly recommend that anyone with an Australian Dollar buying requirement should contact me on HSE@Currencies.co.uk to discuss a strategy for your transfer in order to maximise your currency return.