As currency markets reopened this week Sterling can be seen once again gaining on the Australian Dollar, with the pair trading as high as 1.9727 at the highest point of the day with the pair currently trading up just under 1%.
I think that there’s a chance we could continue to see Sterling strengthen against the Aussie Dollar in the near term future, despite the EU Referendum being just just 6 weeks away.
As ‘Brexit’ polls point to a sizable lead for the ‘Remain’ campaign, the likelihood of the UK leaving the Eurozone is now looking highly unlikely despite a slight gain in support of a ‘Brexit’ this month. With this in mind the downward pressure on Sterling is weakening and this is being reflected in a number of major currency pairs, especially AUD which is experiencing weakness of its own right now.
The Aussie Dollar took a double hit last week as the RBA cut Interest Rates down to record low of 1.75%. Then later in the week there were further suggestions from RBA members that further interest rate cut’s could be implemented in the short term future. Both announcements resulted in downwards spikes for the Aussie Dollar, and a number of market analysts are now predicting that due to the expectations of a further rate cut we could see further downside as market speculators price in this anticipated drop.
ANZ Bank has added ‘Expectations of further rate cuts by the RBA will likely see net long positions in AUD reduced further’.
Most of the news releases this week which could affect the GBPAUD rate of exchange will be coming out of the UK as Australia has a quiet week in terms of news releases. The Bank of England will announce it’s Interest Rate Decision later this week and although nothing is expected to change, including the voting patterns of the BoE’s voting members, we could see further upwards movement for Sterling should any members of the BoE adopt a bullish tone in the Minutes speech afterwards.
If you have a currency requirement involving the Australian Dollar and the Pound, it’s worth your time getting in touch with me (Joseph Wright) directly on [email protected] or 01494 787 478 in order to discuss when best to make that conversion, and to take advantage of award winning exchange rates. I’m also happy to compare our exchange rates with those of other regulated brokers, just provide me with a basic outline of your requirements and I’ll be back in touch as soon as possible.