The Australian Dollar has made considerable ground vs Sterling recently breaking below 1.80 for the first time in a few weeks after the Bank of England chose to keep interest rates on hold with a 7-2 split.
This did not come as too much of a surprise to the markets but what has caused the Pound to weaken vs the Aussie Dollar is that the UK growth forecast have been downgraded from 1.8% to 1.4% for 2018.
This has changed since the last forecast which was released in February and this has caused the fall in value of Sterling against a number of different currencies.
Governor of the Bank of England Mark Carney did then suggest that this dip could be a ‘temporary soft patch’ and that if things improve then we could see an interest rate hike later in the year.
As we go into next week we could see a very volatile period on Tuesday as the Reserve Bank of Australia release their latest set of minutes from their previous meeting.
I think we could see the Australian Dollar come under pressure with GBPAUD exchange rates improving above 1.80 again as I think the minutes will be rather dovish, which means any interest rate hike will be well off the cards for the time being.
Interest rates in Australia are currently sitting at 1.5% and with wage growth still very slow at the moment down under I cannot foresee a rate hike in Australia during 2018 and this is why I think we could see the Australian Dollar weaken following the RBA minutes.
Later on Tuesday morning the UK will release both average earnings as well as unemployment data and both have shown positive signs recently so another positive release could see the Pound improve early next week against the Australian Dollar.
Having worked for one of the UK’s leading currency brokers for 15 years I am able to offer you bank beating exchange rates as well as helping you with the timing of your transfer when buying or selling Australian Dollars.
For a free quote then contact me directly by calling 01494787478 from Monday 830am and asking for Tom Holian when calling or email me directly with a brief description of your currency requirement and I look forward to hearing from you.
Tom Holian [email protected]