Interest rate hikes look extremely unlikely

AUD GBP Lower Ahead of PMI Data for the UK Economy

For the first quarter of 2018 Australian core inflation hit 1.9% and headline inflation was 0.4% down 0.6% from the final quarter of 2017. The quarterly inflation numbers support the Reserve Bank of Australia’ stance to keep interest rates on hold for the time being. Many economists are suggesting a hike for the RBA will not materalise until the summer of 2019 and I have to agree which is a problem for Australian dollar sellers.

An interest rate hike has the potential to collapse the property market as many Australian’s have 0% mortgages and others have properties that they struggle to pay for now due to property prices rising over the years. My personal opinion is that average earnings need to rise and inflation would have to become out of control before a hike materialises.

As it is Anzac day tomorrow there are no data releases to look out for tomorrow. The next batch of releases to look out for are import and export price index numbers and both are set to show a steep decline. If this is the case you would expect the Australian dollar to come under pressure further.

In regards to GBPAUD exchange rates, with exchange rates now remaining buoyant above 1.80, the golden question is what is next? UK MPs are set to meet in the house of commons on Thursday to discuss the customs union. With MPs split whether to leave and remain and the PM stating there is no choice the UK has to leave this story could put pressure on the pound.

If you are trading Australian dollars this week, month or year I would recommend emailing me with the the reason for the transfer (company goods, property purchase) and your timescales and I will response with the options available to you [email protected]. Alternatively if you would like to discuss your requirements over the phone call 01494-787478 and ask to be put through to Dayle Littlejohn.

** If you are already using a brokerage, I would strongly recommend you compare rates as I am confident I will be able to offer you additional savings with your transfer. All you need to do is email me with the exact figures and I will reply with our live price. This will take you a few minutes and in the past I have saved clients thousands! **