The Australian dollar remains under pressure as events on the global stage continue to drive the dollar lower. The uncertainty over the potential trade war between the US and China has implications for the Australian dollar too. China is Australia’s largest export market so any slowdown in economic growth in China results in an immediate reduction to Australian exports. The other issue that stems from this is that a global trade war would potentially see a slowdown in economic growth causing some currencies to include the commodity currencies to weaken of which the Australian dollar is one of them.
Rates for GBP AUD are currently sitting above 1.84 which has presented a great opportunity for those clients looking to buy Australian dollars. The pound has been boosted considerably of late on the back of a brighter outlook on Brexit and the prospect of an imminent interest rate increase in the UK. The Bank of England next meet in May and there is a high chance that the central bank will raise interest rates. This seems particularly likely now that wage growth numbers released yesterday increased for the first time in a year. The Bank of England have been paying very close attention to this data set and the boost is proving very positive for sterling.
Those clients looking to sell Australian dollars could see an improvement assuming the rhetoric on trade tariffs begins to die down. The US is currently renegotiating the NAFTA agreement with Canada and Mexico. You may ask what this has to do with the Australian dollar – In my view any progress on this agreement could signal a turning point for US President Donald Trump with new terms agreed and may start to calm those nerves in the financial markets. As such the Australian dollar could be a beneficiary on any positive developments in the world arena.
To discuss your own requirement and how these events have a direct impact on personal currency transfers then please get in touch with me at [email protected]