Once more on this website I must report a further terror attack on UK soil, the third since March. At the time of writing 7 people have been confirmed dead, in addition to the three attackers who have been shot dead by police, and 48 people are currently in hospital receiving treatment.
Discussing currency in these situations seems trivial, but the effect of this attack on the Pound’s value must be addressed, and the potential impact this may have on anyone wishing to use Pounds to buy Australian Dollars, or anyone wishing to purchase them using Australian Dollars in the near future.
Given patterns around the recent spate of horrific attacks, once the attack is proven to be contained, any noticeable reaction from currency markets recedes as well.
As this act of senseless violence has occured over a weekend, currency markets were not open to initially react to the news, and, as such, it is unlikely that we will see any direct reaction from currency markets once they reopen come Monday morning on GBP/AUD. Particularly since Theresa May has confirmed that the election will continue as scheduled.
With little economic data to be released this week, buying and selling Australian Dollar rates of exchange will largely be governed by the twists and turns of the UK election. This is because there is expected by be no change in the Australian interest rate decision overnight on Tuesday.
The most recent polls were released over the weekend and I have included them below.
- Conservatives 47
- Labour 35
- Comres adds that PM May’s personal approval rating has turned negative for the first time since becoming prime minister
- Conservatives 40
- Labour 39
- The previous poll from this lot (back on May 21) showed a 12 point lead fro the Cons.
- Conservatives 42
- Labour 38
- Prior YouGov poll had the PM with 7 point lead, down to 4 now
- You Gov project a 14 seat majority for May’s party
- Conservatives 45
- Labour 36
- Conservatives 45
- Labour 34
- Cons ahead by 9 compared with 14 in this poll a week ago
Whilst there is still a large difference between the polling companies’ results, the momentum gained for Labour is clear, and this is why the Pound has been depreciating against the Australian Dollar recently.
With these last minute polls still showing a fair bit of difficulty for the Conservatives to achieve their Parliamentary majority, this uncertainty should continue to harm the Pound in the run-up to the election. I would expect a fairly gradual deterioration in GBP/AUD in the run-up to, and including, Thursday’s polling.
As such, anyone with an Australian Dollar buying requirement may be wise to secure their currency within a short period of the opening bell on Monday to avoid potentially swallowing distasteful rates later on in the week.
I work for one of the longest running currency brokerages in the UK, and I have never had an issue securing more competitive exchange rates than what is on offer elsewhere, and these current buying levels can be fixed in place for a future requirement. This is useful if you require currency later on this year, but do not wish to gamble on the election result improving your situation or making your transfer more expensive.
You can contact me over the weekend whilst markets are closed on [email protected] and I will respond to you as soon as I am able with a quote and a tailored strategy for any of your upcoming transfers.