The Australian dollar has been boosted following employment data which rebounded in April with another 22.6 k jobs added. Unemployment actually rose slightly to 5.6% from 5.5% although this was more to do with a higher participation rate and the markets appear not too concerned over this aspect. Australian consumer inflation expectations data also rose which is helping to support the Australian dollar. A higher level of inflation in reality would be one of the first triggers for the Reserve Bank of Australia to raise interest rates which lends support to the Aussie.
Rates for GBP AUD have fallen to below 1.80 creating a good opportunity to sell Australian dollars for pounds. Clients looking to convert from AUD into GBP may wish to consider taking advantage of the sudden improvement as the Australian dollar could find itself in deeper water depending on how events unfold with the trade tariff war between the US and China as well as more recent geo political risks in the Middle East. US President Donald Trump has only just pulled out of the Iran nuclear deal and there is likely to me a lot more mileage from this change.
Brexit is about to become hugely political and volatile for the pound in these coming weeks ahead of a vote in the House of Commons on a series of amendments put forward in the House of Lords. As of now a total of 14 amendments have been made in the Lords which will deliberately seek to keep Britain in a customs union. The risk for the pound is that there could be more political uncertainty that comes out of this if Theresa May is unable to get through her vision of Brexit in the House of Commons.
Should she lose the vote then we could be moving into general election territory or the prospect of a new Prime Minister. There could be some bumps in the road In the next few weeks which could create some better opportunities for those clients looking to sell AUD if political tensions escalate in the UK.
For more information on the Australian dollar and assistance in making transfers at the best rates of exchange then please get in touch with me at [email protected]