Sterling vs the Australian Dollar has had a bit of a surprise movement during today after the UK posted much better than expected inflation figures.
The Pound has increased by 2 cents against the Australian Dollar as the UK confirmed rising inflation to 2.3% from the expectation of 2.3%. This has helped the Pound as it reinforced the Bank of England’s recent announcement that one of the 9 members of the Monetary Policy Committee voted for an interest rate hike.
In my opinion we are a very very long way from any chance of the UK raising interest rates but if inflation continues to rise this could cause a problem for the UK.
Guy Debelle who is the Assistant Governor of the Reserve Bank of Australia is due to hold a press conference tomorrow and any suggestion as to what the RBA’s thoughts are with interest rates going forward could cause movement overnight against Sterling.
However, with 8 days to go before Article 50 is triggered it is important to make sure that you are in a position to move very quickly when it comes to converting Australian Dollars.
My feeling is that we could see problems facing Sterling next week as if we look back to what happened when the Brexit occurred last year the Pound fell dramatically.
Therefore, as the precedent has been set my prediction is for a huge amount of volatility coming in the next week.
If you’re worried about what may happen to GBPAUD exchange rates in the near future but do not have the full availability of funds it may be worth considering buying a forward contract which allows you to fix an exchange rate for a future date for a small deposit.
If you have a currency transfer to make and would like to save money on exchange rates compared to using your own bank then contact me directly for a free quote and I look forward to hearing from you.
Tom Holian [email protected]