It is now the best time to buy the Australian Dollar since the UKs EU referendum, could there be further advances for GBPAUD this week?
Similarly to the Euro and USD, the AUD also slipped to a 2-month low against the Pound on the back of a vast improvement in construction data and manufacturing in the UK, showing signs of the Brexit vote having less of a negative impact on the economy compared to originally feared. We also saw the AUD weaken at the beginning of August due to the RBA cutting interest rates to a record low of 1.5%. Over the course of the last 30 days AUD buyers have benefitted significantly, with GBP/AUD rising by just over 6%. That’s a potential saving of £7,000 on a $200,000 transfer if timed correctly.
At currencies.co.uk we offer a range of contract options that can help you take advantage of these types of rate moment including a limit order which will purchase your currency automatically once the market hits your target rate, or a forward contract, allowing you to lock in your rate of exchange today for months in advance. Contact your broker here for more information on how to take advantage of these.
Following on from last months’ decision to cut rates, the RBA are meeting early on Tuesday morning to announce their most recent interest rate decision. Given the fact they cut rates to a record low only a month ago I think it is highly unlikely we will see a change in policy and the AUD may spike as a result. Following the decision, the RBA will release a statement to give further insight in to their decision and give hints towards future policy so anyone with an AUD requirement should keep an eye on this. On Wednesday there are also GDP figures released for Q2 of this year but they look set to show a significant decline which could offer a further spike for the Pound and another good opportunity for AUD buyers.
Australia’s Prime Minister, Malcolm Turnbull is currently present at the G20 meeting in China, and he has given hope to the UK of a free trade agreement following on from Brexit. He has told May that they are keen to put an agreement in place and will be as supportive and accommodating as possible. Any developments on this could benefit both economies and therefore may strengthen the AUD and GBP in the longer term.
Whilst it is unlikely that the RBA will cut rates this week, if they do decide to act Pound Sterling could reach new highs against AUD since the Brexit vote. Get in touch with us today on 01494 725 353 if you have any questions about todays report.
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