The pound has slipped against the Australian dollar losing 0.3% although still maintaining the higher ground seen in the last two weeks. Rates for GBP AUD have 1.70 in sight and my view remains that this is likely to be seen.
The pound performed well yesterday after a confident and calm Autumn Statement delivered by Chancellor of the Exchequer Phillip Hammond. This could have been a different story considering the coverage of the very high levels of debt that the government has to service but the fact that economic growth in the UK is expected to be amongst the highest in Europe is helping support sterling.
UK GDP numbers for the third quarter are released tomorrow morning and have the potential to create high volatility. Anything steady or stronger than expected could see the pound rally.
Politics Driving Sterling Exchange Rates
UK mortgage approvals this morning also arrived higher than expected providing another boost for the British economy at a time when the doom and gloom surrounding Brexit has been unsurmountable. It was only today that ex-Prime Minister Tony Blair came out and stated that Brexit is stoppable and peddled more Brexit doom. Hasn’t this man done enough damage?
Like it or not, politics surrounding Brexit and Trump is the order of the day for the sterling exchange rates and the Supreme Court ruling in December on whether Prime Minister Theresa May must consult Parliament to Invoke Article 50 is essential. This event for me carries a sizeable risk for sterling. The markets are likely to perceive a government win at the Supreme Court as a sign of a hard Brexit and the pound would likely fall in this scenario although there are other potential scenarios as well.
Clients who are holding sterling or dollars are seeing some much better times after all the Brexit uncertainty to date. There may be a little bit further to go for the pound although there will inevitably be more hurdles surrounding Brexit as outline above. The Supreme Court case commences 5th December 2016 and it would pay to consider all your options well before this date which is now fast approaching.
If you have an upcoming currency requirement either buying or selling Australian dollars 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 the team for James. Alternatively, I can be emailed directly on [email protected]