The Pound had a difficult day across the board yesterday against a number of major currencies and this was no more obvious than vs the Australian Dollar. The Pound is now trading at its lowest point in a fortnight and the previous low prior to that was back in February. The Australian Dollar report below looks at the interest rate decisions from both the Bank of England and Federal Reserve Bank to see how these could impact the commodity based Aussie. The table below shows the difference in Austrlian Dollars you could have achieved in return when selling £200,000.00 during the high and low points of the past 30 days depending on the exchange rate at the time.

Currency Pair% ChangeDifference on £200,000
GBPAUD2.1%AUD $7,200

The Australian Dollar had been struggling recently owing to the issues of a Trade War between the US and China but now appears to be improving. Typically, when China comes under pressure this will often result in weakness for the Australian Dollar but as the news appears to be moving away from this subject this has seen the Australian Dollar improve in value.

China has announced that they are seeking to open up the trade talks between themselves and the US again and this had led the AUD to improve. Previously the discussions had broken down and this had caused GBPAUD rates to move towards 1.80 last month but the reversal in the discussions has helped the Aussie Dollar.

Reserve Bank of Australia may have to raise interest rates

However, we could see a lot of movement coming for GBPAUD exchange rates with the release of Super Thursday. The news begins overnight with Australian Import & Export data as well as Australian Trade Balance for June. The prediction is for AUD900mn so anything different could cause a lot of movement overnight.

It may be worth looking at placing a Limit Order which allows you to set a price outside of trading hours that is not currently achievable.

However, it is likely that Australian Dollar exchange rates will be mainly affected later in the day by what happens with the Bank of England’s interest rate decision so make sure you’re well prepared for the volatility that we could see during tomorrow’s trading session.

 

Overall, I expect the Australian Dollar to move towards 1.75 in the short term so if you’re thinking about buying Australian Dollars it may be worth getting this organised in the short term.

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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Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.