GBP/AUD slumps on first day of April trading (Joshua Privett)

Commodity Based Currency AUD Struggles During Global Uncertainty

Buying rates for Australian Dollars, GBP/AUD, have fallen sharply on the first day of April to begin a cycle which has become all too familiar since 2016 commenced.

During the first two weeks of the month markets are flooded with economic data showing the performance of each global economy during the previous month. The currency used by that economy then sees its value fluctuate heavily based on the positive or negative nature of those results.

The first two weeks for Ferbuary and March have now both seen sharp losses on GBP/AUD exchange rates.

From February 1st to the 14th rates fell from 2.042 to 1.998.

From March 1st to the 14th steeper falls of 1.964 to 1.898 were recorded.

UK perfomance data simply isn’t holding up well to against Australia, and indeed against most other major economies.

Investors are concerned with growth above all. Whilst certain parts of the UK have improved, such as unemployment rates and a lowered trade deficit, growth is stagnating. George Osborne has revised expectations downwards twice this year already, in what he is describing as the most testing year in the UK since the recession.

The recent uproar about Tata Steel is enough to show that even international businesses with heavy investments in the UK are withdrawing because they do not feel the UK will be turning their current slowdown around anytime soon.

By contrast Australia has been benefitting from the recent upturn in commodity prices, which seem to have bottomed out in recent weeks. Indications that Malcolm Turnbull may not be calling an early election following the rejection of his tax reform proposals also indicate greater stability for Australia at least in the short-term.

The final trump card for investors is also the Australian Dollar’s sky high interest rates which are four-times higher than the UK’s. With low global growth, interest rates play a larger factor in currency investment – so the Dollar is beginning to shine brighter against its peers and become a more expensive prospect.

These combined factors are why the first two weeks of the last two months have shown gains for the Australian Dollar against Sterling like clockwork. This month is already proving to be no exception, with central levels already hitting 1.85 on GBP/AUD.

I strongly recommend that anyone with an Australian Dolar buying requirement should contact me over the weekend on jjp@currencies.co.uk

If you detail your upcoming need for Australain Dollars over the coming few months, I can personally reply when I arrive in the office on Monday morning to discuss a strategy for your transfer in order to manage your risk exposure as you wait to complete your transfer and maximise your Dollar return.

If you also supply the best number to reach you on I can make contact as soon as UK markets open to discuss expectations over the coming days and weeks which on what events will affect your transfer. Calling Australia is not an issue asI regularly do so following enquiries from my articles.

With the steep falls on Friday, opportunities may present themselves in the short term for Euro buyers as markets stabilise. I have never had an issue beating the rates of exchange offered elsewhere, and with the current volatility on the marketplace, getting in touch could save you thousands with a well timed transfer.

Australian Dollar sellers can do the same, and I can explain how to ride the expected movements in your favour to their peak within the time-period you have to complete your transfer.

Please feel free to reach me on my direct line in the morning on 01494 787 478. If I do not answer, ask one of my colleagues or the reception team to be put through to Joshua Privett. I may simply be on the phone or away from my desk for a few moments.