How will GBPAUD react to the UK election?

AUD GBP Higher after Inflation Data, Sunak Budget Ahead

How will the pound perform against the GBPAUD rate is a valid question given the UK election on Thursday which has real potential to move sterling sharply higher or lower. The pound is looking more and more at risk of some big movements as the uncertainty around the actual outcome persists further. The general belief is that Theresa May could win the election with a decent majority but if she fails to sterling could drop, GBPAUD could rise as high as 1.80 or fall back into the 1.60’s. If you have a transfer to make then

Whereas before the UK Referendum last year there was a 1 to 8 chance of a Leave vote winning, now the hung parliament is at odds of 1 to 3 and a Jeremy Corbyn win is at 1 to 5 odds! The general belief is as I say a UK election victory for Theresa May but whereas the previous belief was a strong majority, now we are looking at less chance of the ‘landslide’ that was predicted. If you have a transfer to make then understanding the market and potential movements in the future is key to getting the better deals.

The Australian dollar has been a little stronger on the back of the news of the latest Reserve Bank of Australia news that indicated interest rates could be rising soon in the future possibly to as much as 3% over the next few years. Such a positive outlook helped the Aussie to claw back some ground against the weaker pound and depending on the outcome of the election we could see the rate below 1.70. A strong Theresa May win could however easily push this into the high 1.70’s and even over 1.80.

If you have a transfer to consider and wish to learn more about the market and all of your options then please get in touch. We can help with the planning and execution of any exchange. A limit order is perfect in this kind of market as it guarantees your rate if it is suddenly hit during a period of unexpected movement.

For more information please contact me Jonathan Watson on [email protected] to discuss how we can help maximise your exchange rate.