The Australian dollar has weakened this week after a sharp fall in iron ore prices put pressure on the commodity currency. Iron ore represents one of Australia’s largest export markets and a reduction in prices is usually seen as negative for the Australian dollar which is helping see a rally in the GBP AUD pair.
|Currency Pair||% Change in 1 month||Difference on £200,000|
The fall in iron ore prices has been substantial with a drop of up to 9% earlier in the week which represents the largest fall in over a year. The Australian dollar is also nervously awaiting the G20 summit where US President Donald Trump and Chinese leader Xi Jinping will meet to hold trade talks. This could have a major impact on the Australian dollar as concerns over the health of the global economy have continued to grow. Any further tariffs on Chinese goods could see the Aussie come under further selling pressure as investors shy away from the Aussie.
Pound to Australian dollar exchange rates are particularly volatile as the markets try and predict the outcome of a meaningful vote to be held in Parliament around the 11th December. Any gains for the GBP AUD pair are likely to remain muted in the run up considering it will be a very difficult vote (but not impossible) for the Prime Minister to win. The markets are looking for stability though so if she can get it through the House of Commons, we're likely to see material gains for the pound against the Australian dollar.
Economic data from Australia is light as we end the week so focus will now move to Import / Export data and building permits next week, ahead of the Reserve Bank of Australia (RBA) interest rate decision on Tuesday.
The RBA have been pleased with an improving economic outlook especially on the number of new jobs being created although the next interest rate increase is unlikely to happen before August 2019.
James and his colleagues are always courteous and helpful. I have also never been able to find rates of exchange that are more competitive. I am particularly impressed with the service, as I am not in the habit of transferring massive amounts!
As always a really quick and easy transaction. James is very knowledgeable and helpful. Great rates.
Always helpful and they always give rates at the very top of the range. Quick transfers to our french bank account – highly recommended. Well done James Lovick 😉