GBP/AUD Rates Touch 1.70! (Matthew Vassallo)

AUD GBP Awaits Australian GDP Growth Figures

GBP/AUD exchange rates hit 1.70 overnight, with the Pound finding support over recent days.

The reason for the improvement is more likely tied to a report released by Australian lender Westpac, which suggested they do not expect to see an interest rate hike in Australia until 2020.

This news is a far cry from the three rate hikes that had been predicted by the ANZ bank by the end of 2019 and the markets have reacted accordingly to the news.

Investors had probably started to factor in further rate hikes but with this scenario now called into question, investors have started to pull funds away from the AUD, devaluing it as a result.

Whilst a decision on interest rate rises rests with the Reserve Bank of Australia (RBA), it does look increasingly unlikely one will occur in the short-term and despite continued pressure on the UK economy due to Brexit negotiation fears, it may be wise to protect any short-term AUD sell positions around the current levels.

Looking at the UK economy and the current market focus still centres very much around Brexit and how negotiations are likely to fair over the coming months.

Theresa May’s much anticipated Brexit speech went ahead on Friday, as members of the press waited in anticipation for an insight into the UK’s revised strategy for leaving the single bloc.

Whilst her bullish tone was expected, she reaffirmed many of her previous comments and as such I was left fairly underwhelmed by much of what was said.

The key points focused on rights of EU nationals, a smooth Brexit transition and a commitment to on-going payment subsidies to the EU, following the UK’s transition to a single state entity. The PM once again reiterated that the UK would not remain part of the single market or customs union, as the fallout continued following what has fast become one of the highest profiled and messy divorces in the history of politics.

Despite her positive, almost nostalgic undertone, it was interesting to note that she still believes that “no deal is better than a bad deal”.

It will be interesting to note how EU leaders and subsequently the markets react to the key points of her speech but nothing she said gave any indication that negotiations were suddenly going top progress positively, or at any great pace.

If you have an upcoming GBP or AUD currency transfer to make you can contact me directly on 01494 787 478. We can help guide you through this turbulent market and as a company we have over eighteen years’ experience, in helping our clients achieve the very best exchange rates on any given market.

Our award inning rates can be accessed very easily over the phone and I can keep you posted with key market developments ahead of any prospective exchange you need to make.

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