The Reserve Bank of Australia has recently decided to keep interest rates on hold as it appears as though the likelihood of any interest rate cut at any stage is minimal.
The Reserve Bank of Australia governor Philip Lowe has suggested that the global economy is improving and claimed that business and consumer confidence is on the rise.
Commodity prices have continued to remain very high which has boosted Australia’s income and the improvement has led to the strength of the Australian Dollar against the Pound.
GBPAUD exchange rates have struggled to break out of the range of 1.60-1.62 recently and it appears as though the Pound is struggling to make any real gains whilst we await what will happen once Article 50 is triggered.
When the Brexit vote was announced last June we saw a huge loss in value for the Pound against all major currencies and as a precedent has been set previously there is a risk that we could see problems for the Pound once the trigger has occurred.
However, on this occasion it is clear that Article will be triggered so there is also an argument that is has already been priced in.
On Tuesday we have further economic data from both Australia and China which could impact GBPAUD exchange rates. The most important data release of the two will come with Chinese Retail Sales & Industrial Production data. Any change compared to the expectation is likely to move the markets.
Whatever happens I expect there to be some volatility coming in the weeks ahead so in order to avoid the risk of the market moving against you it may be worth looking to at buying a forward contract which allows you to fix an exchange rate for a future date.
If you would like a further information or for a free quote when buying or selling Australian Dollars then contact me directly for a free quote. Having worked in the industry since 2003 for one of the UK’s leading currency brokers I am confident of also helping you with the timing.
Tom Holian [email protected]