The Australian dollar had been strengthening consistently against the pound, gaining by almost 9 cents in the last three weeks. To put this into monetary terms, a £200,000 purchase became over $16,800 cheaper if timed yesterday compared to three weeks ago, and yesterday’s highs provided clients with the best opportunity to transfer Australian dollars into pounds in just over 2 months.
|Currency Pair||% Change in 1 month||Difference on £200,000|
Although the majority of this recent strength had been mostly due to Brexit uncertainty and the weakening pound, yesterday’s Australian dollar strength can be put down to Donald Trump’s comments in an interview to Fox News suggesting that he and Chinese President Xi Jinping would meet next month at the G20 summit in Buenos Aires, and that a deal to end the trade war could be reached.
As China is Australia’s largest trade partner, the Australian economy and therefore the value of the Australian dollar had been heavily impacted by the uncertainty caused by the trade war between the world’s two largest economies. Although a deal isn’t certain, some of the pressure was lifted and therefore boosted investor confidence in the Aussie too.
Overnight last night, Australian Inflation figures for the third quarter were released and provided another gloomy outlook for the Australian economy. Consumer Price Index figures fell to 1.9% from 2.1% in the previous year to September.
Inflation is a key barometer of the health of an economy, and plays a large part in deciding future monetary policy changes by Central Banks. The Reserve Bank of Australia has kept Interest Rates on hold at 1.5% for two years now, falling behind many other economies including the US which continue to raise Interest Rates, making them a more attractive investment providing greater returns.
This news isn't likely to give the RBA the confidence it needs in the economy to be able to warrant a hike in Interest Rates any time soon.
As such, the Australian dollar has weakened this morning against its major currency counterparts, although at the time of writing this GBP/AUD still remains close to the 2 month lows previously mentioned. However, clients with a short term Australian dollar purchase requirement could benefit from getting in touch this morning to capitalise on last night’s gains.
Always a fast and efficient service, a good rate and a simple transfer.
Excellent customer service, very friendly and helpful staff. The process of money transfer is painless. Thank you.
The service was effortless to use and I was kept up to date all the way through the process with courtesy calls and advice from the same contact in the selling of my home abroad and returning the funds back to the UK. I would highly recommend this service to friends and colleagues in the future.
Efficient service and good rates. My currency reached my overseas bank same day!
I find the process to be efficient, uncomplicated, and very good value – the exchange rates used are unbeatable, and the fixed service charge is insignificant when sending a large-ish sum.