Since the UK’s decision the separate from the EU, sterling has generally struggled to gain ground against its western currency partners, but this hasn’t been case for the GBP/AUD paring. More on the internal and external economic factors impacting the commodity based currency below, with the table showing the range of GBPAUD exchange rates throughout the past week and the potential difference in return you could have achieved when selling £200,000.00 during the high and low points.
|Currency Pair||% Change||Difference on £200,000|
Despite sharp volatility, the pairing is currently towards the better levels seen following the steep referendum crash with movement of almost 7 cents since the second week of August.
In monetary terms, a well-timed transfer since the start of last month could have achieved around $14,000 more AUD at the better levels, on a £200,000 transfer.
Australia’s commodity-based currency has been under increased pressure since the start of the year, as US President Donald Trump’s bullish approach to trade negotiation with China, the countries key trade partner, which has affected the currencies sentiment for investors. Recent economic releases for the Chinese economy have only further added to the short-term concerns over the AUD, as it appears the ongoing trade battles with the US are starting to bite and effect the Chinese export market.
In addition to this, Australia’s Central Bank decided this week to keep interest rates on hold at record lows of 1.5%, which is further adding to pressure on the currency.
Australian GDP was released yesterday and despite a decline of 0.1% in the data for Q2 (MoM), the result was better than expected and the year on year data providing a positive increase of 0.3%, which could give reason for confidence in the short-term forecast of the Aussie.
This being said, there will be key Chinese import and export data released over the weekend which could provide an indication as to how the Chinese economy is responding to the current global trade tensions, which will reflect on the performance of the AUD.
This could see potential for AUD movement over the weekend, so clients with an upcoming requirement could benefit by contacting their account manager to discuss contract options such as a limit order or stop loss, to ensure they are prepared in the event of volatility.
For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353 or email me here.
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