Australian Dollar gains strength due to strong commodity prices
The Australian Dollar has seen gains against the majority of major currency pairings of late, predominately due to a rise in commodity prices. Iron ore is Australia’s primary export and we have seen gains of late. There is a clear correlation between Australian dollar value and iron ore price, so it is always wise to keep an eye on iron ores value. This is due to a heavy reliance on the Chinese purchasing Australian iron ore. Chinese is dwindling , but it is still considered to be very healthy.
If I was an Australian Dollar seller, I would be tempted to take advantage of rates as they sit. If we take GBP/AUD for example, Sterling made gains on the Aussie to 1.79, but has since slid back to 1.72 following the lack of clarity on Brexit combined with commodity price. The fear for me regarding the Australian Dollar is the predicted rate rises in the United States.
The Australian Dollar is considered a reasonably safe currency to invest in with relatively high returns, investors are happy to keep there funds in AUD due to this. There has however been a recent rate hike in the US, bringing the US interest rate in line with Australia’s at 1.5%. The Reserve Bank of Australia currently have little justification to hike rates down under whereas in the US the Federal Reserve has stated it’s intention is to make as many as three rate hikes during 2018. With the chances of higher returns in a safe haven currency many investors with funds in the Aussie may well move to the green back. If you are selling the Australian Dollar in may be wise to take advantage of current levels.
If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker if you wish to get the most for your money. If you let me know the details of your trade I will endeavour to produce a free trading strategy to suit your individual needs. Have faith knowing you will be dealing with a brokerage in business for over 16yrs, Foreign Currency Direct Plc. We are a no risk entity as we do not speculate on the market and we are registered with the FCA. If you have a currency provider take a minute to send over the rates they offer and I am confident I can demonstrate a significant saving. I can be contacted at [email protected] . (Daniel Johnson) Thank you for reading.