Over the last 30 days buying the AUD with the UK Pound has got over 12% more expensive. The following the uncertainty in the UK market about its future within the EU resulting in a lack of demand for the Pound and its value falling. This was however nearly a month ago and eyes are now on the Reserve bank of Australia and their financial policy moving forward. There has been a growing speculation that the RBA will be looking at cutting their interest rates once more in the near future.
Minutes from the RBA meeting in July were released overnight and indeed has continued to build speculation that this cut will be introduced, possibly as early as next month’s board meeting. Concerns over the domestic economy with inflation problems and a widely spotted housing problem have suggested that a looser monetary policy may be interested.
This is great news for anyone with AUD to buy as this should weaken the AUD and make it cheaper to buy when confirmed. In-fact as the speculation builds the market has priced this in and given an opportunity this afternoon which will be in high demand. These current levels are expected to be the best for the week ahead as we see economic data for the UK tomorrow which risks a further fall in the pounds value. This is the UK Unemployment data for June, even though the full effects of the referendum result may not have been felt there was a widely adopted policy of halting all recruitment. The downside tomorrow is expected to be a lot bigger than that of the potential upside. Meaning that if unemployment data for the UK is ‘OK’ rates will go up a little however if they are as expected and poor rates could fall quite a bit.
If you would like more information on market movement going forward, live prices or indeed forecasts please feel free to contact myself STEVE EAKINS – [email protected]