The Australian Dollar appears to have gone from strength to strength vs the Pound in the last two weeks after the UK has released a string of poor economic data.
Last week UK GDP data for the first quarter of 2018 came in much lower than expected with just 0.1% growth quarter on quarter which is the slowest level since 2012 and shows signs of a real slowdown in the UK.
Only a fortnight ago average earnings had outpaced inflation for the first time in a long time and this increased the chances that the Bank of England may be gearing up for an interest rate hike on 10th May.
However, since then the negative data in the UK means that a rate hike happening next week is now highly unlikely and this is why we have seen the Pound drop against a number of currencies including the Australian Dollar.
Indeed, this is the first time in a few weeks where GBPAUD exchange rates are now trading below 1.80 on the Interbank level.
On Tuesday there is a huge amount of data due out from China and as the Chinese are the largest trading partner with Australia any data announcement can have a big effect on Australian Dollar exchange rates. We see the release of Chinese Export & Import data as well as the Trade Balance figures so if the data is positive this could mean further gains for the Australian Dollar.
In the longer term I expect the Pound to make gains vs the Australian Dollar but in the short term I think the Pound will remain under pressure.
Therefore, if you’re in the process of buying Australian Dollars in the next few weeks it may be worth getting things organised soon.
If you have a currency requirement coming up and would like further information about what is happening or for a free quote then contact me directly and I look forward to hearing from you. Having worked for one of the UK’s leading currency brokers for 15 years I am confident of being able to offer you bank beating exchange rates.
Tom Holian [email protected]