This AUD article will discuss factors that could impact Australian Dollar exchange rates. The table below shows the change in the GBP/AUD rate on Friday:
|Currency Pair||% Change||Difference on £200,000|
The Australian Dollar has suffered against Sterling of late. We had seen AUD strength following some very impressive retail sales data. I am convinced this is an anomaly that can be attributed to black Friday sales and the release of the Iphone X. I am confident there will be heavy fall in next month’s retail sales release which could cause losses for the Aussie.
If we look at GBP/AUD we have seen a recent advance for the Pound following positive comments in regards to trade from Germany, the Netherlands, Spain and the US. All of which have stated they would like a close relationship with the UK following Brexit.
There was some positivity for the Aussie following data from the Westpac Leading Index which tracks nine gauges of economic activity ranging from share price to telephone installations. There was a leap in growth to 1.41% which caused a small rally against most currencies, but failed to rally against the Pound.
It may not be all rosy however. There is the small matter of phase two Brexit talks due to commence very shortly. Despite positive comments from a number of country's representatives being forthcoming in regards to putting trade deals in place talks are still expected to be far from straight forward.
Negotiations are set to be time consuming and problematic which could cause GBP/AUD to fall back towards 1.70.
Due to many data releases being released outside of trading hours it may be wise to discuss a limit order with your broker. Setting a target rate you switch to the rate of exchange you would like achieve which can be automatically purchased 24 hours a day.
Consumer Price Index data is a measure of inflation and can cause movement on the exchange. Inflation is of significant importance in Australia at present due to the distance between inflation and average wage growth.
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