It would appear that the pound which is enjoying a bounce since the UK enjoyed some slightly better than expected economic data which has given the pound a lift. Much of the data is before the Brexit but it is still giving the UK and the pound lots of support as it suggests that the economic fears about what might happen are over done. The main big shift since the Referendum has been the pound which against the Aussie has dropped by over 20 cents. Some commentators are predicting that we could easily see the rates fall further if we see the Bank of England cut interest rates again or even there is more firm news on what Brexit means. For now there are some very big economic questions to answer, namely what is Brexit and what is the true impact on the UK economy in the future? The answers here will take time and are unlikely to be good news in the short term.
From the Aussie side the Reserve Bank of Australia have stated that they expect future cuts as they target a weaker exchange rate. Part of their policy has been to weaken the Aussie, the idea being that since the economy is a net exporter it will benefit from a weaker exchange rate as it makes selling their goods more attractive. Unfortunately even with a lower interest rate, the currency has not weakened as much as the RBA had hoped and the GBPAUD rate could well drop further. Despite rate cuts the Aussie remains a very attractive currency to hold at this time, owing to the higher interest rates on offer in Australia versus the rest of the world.
If you have a transfer to consider involving the Australian dollar why not get in touch to see if you can get some useful information and also a better exchange rate? Please contact me Jonathan on [email protected] to learn more or fill in the form below.
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