AUD Interest Rate Decision – Is Now the Right Time to Sell AUD?

The Reserve Bank of Australia (RBA) released their latest interest rate decision overnight and as expected the central bank kept rates on hold at 1.5%. The RBA have been fairly bullish of late, with the Australian economy looking far healthier than it did at the turn of the year and the AUD has benefited as a result. Despite this bullish tone they have left further rate cuts open and I would still be very tempted to take advantage of some of the best levels seen over the past three years for those clients looking to sell AUD for Sterling.

Sterling has started to claw back some of the ground its lost against the AUD since the Brexit decision, with GBP/AUD rates moving back above 1.75 at this week’s high. Despite the pair dropping just below this threshold this morning, the Pound has clearly benefited from the recent run of strong UK economic data.

The catalyst for Sterling’s spike was last week’s Manufacturing & Construction data, both of which came in well above market expectation. The is always key for investors who will price in the expected result of any key economic data release. If the figure comes in outside of this we usually see increase market volatility, as happened with Sterling last week. This gives short-term opportunities to those clients holding the Pound to trade above levels they may have expected.

Whilst the Pounds position is looking far healthier than it was a couple of months ago, we need to remember there is still a huge amount of uncertainty surrounding the UK’s current economic positions. We are still no closer to understanding how and when we will facilitate our exit from the EU and the potential impact this will have on GBP exchange rates. Those clients holding Sterling have been given a short-term opportunity to trade almost five cents higher than we sat only a month ago and I would extremely tempted to take advantage of this position and not gamble on what is still a very volatile and unpredictable market.

If you have an upcoming GBP or AUD currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 787 478 and ask one of my team for Matt. Alternatively, you can register your details through this page, or email me directly on mtv@currencies.co.uk

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