The Australian Dollar is not having a great run of things lately, as numerous economies appear to picking up and the U.S have once again raised interest rates, bring them ahead of the current rate in Australia.
The reason this current movement is important is that U.S interest rates are now higher than interest rates in Australia, so what essentially happens is investors will move their funds out of the Australian Dollar and into the U.S Dollar, as it offers a more attractive return on their money and is seen as a more stable currency.
The outlook for Australian interest rates still does not suggest any hike in the near term, however the Federal Reserve in the States did dampen expectations a little for the year ahead in last nights monetary policy statement.
I still feel there is further room for Australian Dollar weakness in the coming weeks, most notably we have seen a big movement for Sterling against the Australian Dollar over the past week or so, breaking through the key level of 1.80 and not stopping there.
Sterling is on a good run at present, and now that average earnings figures have fallen in line with inflation there is room for interest rates in the U.K to start coming up again too, the Bank of England interest rate decision later this morning will be key and so will the minutes from the meeting, as they may give an indication on future plans.
If you are in the position that you may need to carry out a currency exchange in the coming days, weeks or months ahead then it is well worth getting in contact with me directly, you can email me (Daniel Wright) on [email protected] and I will be more than happy to contact you directly with live quotes and to help you develop a strategy as to how to move forward with your transaction.