The Pound has made some limited gains vs the Australian Dollar recently but ultimately is struggling to break much higher.
There are a number of different reasons as to why the Australian Dollar is performing so well against the Pound at the moment and I think we’ll see GBPAUD rates fall below 1.60 in the near future.
The Reserve Bank of Australia has made it clear that there will be no interest rate change for the time being and as interest rates are so high compared to any other leading economy we are continuing to see money invested in Australia.
Commodities have also been improving other the last year with the value of iron ore rising by over 50% in that same time. With iron ore such a huge part of the economy this has also kept the AUD strong against Sterling.
The Pound is also struggling against most major currencies and with next month due to see the triggering of Article 50 we could be in for further uncertainty ahead and a loss of confidence for Sterling.
Indeed, it is not yet clear whether the UK will opt for a hard or a soft Brexit and the lack of clarity is causing problems for the Pound.
The UK economy has actually been performing relatively well but recently we have seen two sets of data that should cause real concern. UK Average Earnings have started to fall and with inflation on the rise this means the UK consumer will ultimately have less money to spend and this was clearly demonstrated with the release of UK retail sales for January which saw the lowest level in three years.
On Wednesday we see the release of Chinese manufacturing data and Australia’s commodity index for February and if both come out well I think we’ll see the Pound fall against the Australian Dollar.
If you have a currency requirement coming up and would like more information or for a free quote when buying or selling Australian Dollars then do not hesitate to contact me directly and I look forward to hearing from you.
Having worked for one of the UK’s leading currency brokers since 2003 I am confident of offering you competitive rates as well as help with the timing of your transfer.
Tom Holian [email protected]