The pound has made good gains against the Australian dollar over the last week although it is now hitting resistance at these higher levels. Rates for GBP AUD are now sitting close to a two month high which is presenting some better opportunities for buying Australian dollars.
UK unemployment data for August is released this morning which could give some new direction for the pound. The unemployment figures for July held steady at 4.9% and there was also an improvement in those numbers claiming unemployment benefit which actually helped drive the pound higher. There is normally however a lag with unemployment data after a shock to an economy so the question is if and when that unemployment number will start rising as a result of Brexit.
Despite an improvement in Chinese exports last week which saw a tremendous leap higher, it has not really had much of a positive impact for the dollar. However the focus now moves to the US Federal Reserve interest rate decision next week where a lack of action could see the dollar start to strengthen again.
There is a slim chance the US Fed could raise interest rates next week which would have the knock on effect of weakening the Australian dollar as funds follow the higher interest rates in the US. However my view remains that the earliest the Fed will in fact raise interest rates will be in December. Economic data is still too uncertain for the US at present and November will be just before the presidential election.
Although the Fed is supposed to be independent from politics I simply struggle to see any decision to hike at that time due to the potential uncertainty that could follow. No change next week by the Fed could see the Australian dollar start to strengthen again for a Spring rally down under.
If you want to be kept up to date on the markets and you would also like to ensure that you are getting the very top levels of exchange for an imminent currency transfer or even a longer term one then I can help you with this.
Not only do we give clients up to date market information but we all work for one of the largest and longest serving currency brokerages in the U.K, so even if you have dealt with your current broker or bank for a long time I would be surprised if I could not show you a saving over what they are offering you – You can email me James Lovick directly on [email protected] and I will be more than happy to contact you personally to discuss the various options we have available to you.