Buying Australian Dollar exchange rates have seen a phenomenal turnaround over the past month. Initial worries of dropping below 1.80 on GBP/AUD were replaced with near on 20 cent gains across 20 active trading days, culminated in last week where 2.0 was breached comfortably.
Both the news of Australia cutting interest rates, the call for an early election in June, coincided with some better performance figures for the UK economy, alongside a stronger showing for for the Remain camp during May’s Referendum polling data.
The turnaround is staggering. It took more than 50 trading days for GBP/AUD to make the falls since the beginning of the year to their absolute lowest point in March, which reflects just how abrupt and, frankly, tempting these current buying opportunities presented to Sterling holders are.
I wrote the above to also highlight the fickle and volatile nature of the current market is, and the pendulum may be swinging in the other direction from Friday of last week.
Polling data has now shown that both camps on the Referendum are now well within the margin of error, and the greater certainty that the UK will be staying within the EU is beginning to be eaten into. Particularly with heavy campaign season beginning to go into full swing -anyone who checks BBC news regularly will now be seeing at least one claim a day from both sides about the benefits or detriments of EU membership- markets will be beginning to look at these numbers with unease.
Whilst subjective, the overwhelming majority will note that a Referendum vote on the UK’s continued relationship with its largest trading partner will be the bigger factor on buying Australian Dollar exchange rates compared to the the upcoming election in Australia.
Furthermore, the most recent reports on the Pound’s two week positive run (not just against the Australian Dollar) have shown a strong correlation to the un-seasonally warm, albeit patchy, weather in the UK. Retail sales figures have climbed alongside employment, and even the Bank of England have noted that this recent stronger performance is not representative of what they are describing as a ‘stagnant’ British economy.
A look this week at growth figures will likely confirm this. Just to put this in context it was reported recently that growth figures for the UK economy during the first quarter of 2016 were out paced by the Eurozone. Data to be released on Tuesday of this week will likely confirm these figures from a second body, taking the recent positive narrative away from the Pound.
Indeed GBP/AUD was already sliding on Friday and briefly hit 1.99 before recovering back above 2. Anyone holding Sterling should seriously consider taking advantage of the recent gains for the Pound ahead of a very uncertain and even more volatile June. The conservative argument is that after the heavy gains made in May waiting for more is the greater gamble.
I strongly recommend that anyone with an Australian Dollar buying requirement should contact me on firstname.lastname@example.org.
If you outline your requirement, alongside the time frame within which you plan to, or need to, complete your transfer, we can have a discussion to decide the best option open to you through a currency exchange specialist which would maximise your currency return.
I have never had an issue beating the rates of exchange offered elsewhere, and a brief conversation concerning your transfer could save you thousands.
Australian Dollar sellers can also get in contact, though my thoughts will sway more towards waiting to see how much the news next week reverses some of your losses over the previous month.