The pound to Australian dollar is looking much better for Australian dollar buyers we we get closer back to the higher levels which we have seen since the Referendum vote. The key piece of evidence on this was the news that perhaps the UK will be receiving some form of privileged access to the single market once it leaves the EU.
Wage growth data from Australia also improved but it wasn’t really a strong enough Inflation figure to justify the hiking of interest rates as many had previously been hoping for. The end result was actually a slightly weaker Australian dollar as despite rising, there is less chance of a case for an interest rate hike. Reduced chances of any interest rate hike are better news for AUD buyers since it makes the Australian currency less attractive to hold.
Inflation is not above the target of the RBA (Reserve Bank of Australia) so there are less opportunities for a case to hike interest rates, general impressions are for a rate rise much further ahead in the future but for now the lack of one is seeing the Australian dollar weaker.
If you need to buy or sell Australian dollars the outlook on Brexit is vital to the short-term drivers on the pound. Overall expectations for sterling are in the main linked to Brexit and a speech next week expected by Theresa May could deliver some of the movement we need to see the GBPAUD rate move higher.
If you have a transfer to buy Australian dollars then perhaps tracking the 1.80 is sensible, if you wish to be kept up to date with the latest trends and themes in the market I would be most interested to hear from you and discuss strategies to help maximise the position.
Thank you for reading and please contact me Jonathan Watson by emailing [email protected] to learn more.