The Australian Dollar has continued its recent bout of strength against the Pound hitting its best level to buy Pounds with Australian Dollars since January.
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The Reserve Bank of Australia once again confirmed that it would be holding interest rates at the same level citing problems in the property market down under. The interest rate of 1.5% has remained the same for the 28th consecutive month and was last cut back in August 2016. Indeed, the last rate hike in Australia was over 8 years ago highlighting the current stance of the RBA.
Governor Philip Lowe has suggested that a change will come in time but he has remained cautious once again by keeping rates on hold.
He made comments a fortnight ago when claiming ‘if the economy continues to move along the expected path, then at some point it will be appropriate to raise interest rates’ and ‘ this will be in the context of an improving economy and stronger growth in household incomes.’
President Trump's confirmation at the recent G20 summit that any tariffs on Chinese goods will be kept on hold for the next three months has helped the Australian Dollar increase in value.
As China is Australia’s largest trading partner any improvements in their economic prospects will often help to strengthen the AUD against the Pound and that has been evident in recent days.
As we go into the next few days Australia will release the latest GDP data for the 3rd quarter of 2018. The expectations are for growth of 3.3% which although lower than the previous quarter the figures are still relatively strong compared to a number of other western economies.
With the Brexit vote just one week away we could see further losses ahead for the Pound so if you need to make a currency transfer to Australia it may be worth getting this organised prior to next week.
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