Australian and UK Interest Rates and the impact on buying Australian Dollars (Tom Holian)

Interest rates both in the UK and Australia have been coming back on the agenda recently. In this month’s latest interest rate decision in the UK there was a 5-3 split in favour of keeping interest rates on hold which was the first time this has happened in a very long time.

UK interest rates are still at historic lows but with inflation rising this could bring with it a rate hike sooner than many might expect.

Inflation in the UK has been rising to as high as 2.9% at the most recent count which is above the Bank of England’s target of 2%.

Inflation is one of the key concerns for the Bank of England and this is one of the reasons why the vote has been getting closer in the UK.

Indeed, Bank of England chief economist Andy Haldane has suggested last week that he may be looking to join the other 3 members in looking at a rate hike later this year.

UK Inflation Report Hearings are due on Tuesday and the likelihood is that interest rates will form  a key part of the report and I think this could lead to the Pound making gains vs the Australian Dollar if Mark Carney suggests an interest rate hike may be coming sooner than many expect.

In the meantime the Reserve Bank of Australia will release their latest interest rate decision on Tuesday morning. I think this could lead to the GBPAUD exchange rate touching 1.70 early next week leading to some good opportunities for anyone looking to buy Australian Dollars with Pounds.

If you would like to save money when buying or selling Australian Dollars compared to using your own bank then contact me directly.

Having worked in the foreign exchange industry since 2003 I am confident of being able to offer you better rates of exchange and also help with the timing of your transfer.

Email me directly with a brief description of your enquiry and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk