The Australian Dollar has continued to weaken against both the Pound and the US Dollar recently as investors have begun to bypass the Australian Dollar as interest rates down under appear to be staying the same for the foreseeable future.
The Reserve Bank of Australia has kept interest rates on hold at 1.5% again this month and they have not changed interest rates in two years and with the US continuing to hike interest rates the Australian Dollar has been sold off in favour of the US Dollar and this has weakened the AUD against a number of different currencies including Sterling.
The Pound vs the Australian Dollar is now trading at its best level to buy Australian Dollars since the Brexit vote back in June 2016 and the question really is how long will this rally for Sterling last?
Clearly the Pound is under a lot of pressure at the moment with the ongoing uncertainty caused by the Brexit talks but the sentiment appears to have been softening recently towards the UK and rumours are that the talks could be concluded by next month.
If this does happen we could see the Pound make even further gains as this will provide investors with more certainty as to what to expect moving forward and encourage them to invest into the UK.
The Australian Dollar has also felt the negative effects caused by the Trade Wars between the US and China. As China is Australia’s largest trading partner any problems in the second largest economy will often have negative effects on the value of the Australian Dollar and I think this could continue to harm the economy and therefore cause further Australian Dollar weakness for the Pound.
I have worked in the foreign exchange markets for one of the UK’s leading currency brokers for over 15 years and with my experience I’m confident that not only can I save you money when exchanging Australian Dollars but also help you with the various options available to you.
Email me directly and I look forward to hearing from you Tom Holian [email protected]