It’s been an up and down few weeks for the GBPAUD currency pair with opportunities being presented for both buyers and sellers. The reasoning behind this volatility is discussed below, with the wide range of exchange rates for the pair displayed in the table showing the difference in return you could have achieved in Australian Dollars when selling £200,000.00.
|Currency Pair||% Change||Difference on £200,000|
As its been heavily documented in the media and within our market reports, Brexit uncertainties are the key driver for Sterling’s demise and this trend looks set to continue in the months to come and as we approach the EU summit in October. However, this morning, Bloomberg have a released an article suggesting both the UK and EU see mid-November as the date for a deal to finalised and not the EU summit. This is another media station to report this news in recent days therefore for clients buying Australian Dollars with Pounds, it looks like the Brexit negotiations will run longer than expected therefore I expect overtime (the extra month) the Pound could fall further against the Australian Dollar.
However it’s not been all positive news for Australian Dollar sellers as Malcolm Turnbull was relieved of his Prime Minister duties and Scott Morrision has taken over. This is the fourth Australian PM to be removed from power by his own party in the last 10 years and as you would expect has put pressure on the Australian Dollar. This news does not come at a good time as investors are fearful about the Australian Dollar at the moment due to the trade wars with China. For new readers, the Australian Dollar heavily relies on China and the theory on the market is that if trade wars between China and the US continue to escalate and therefore we see a slowdown in China, you would also expect to see a slowdown in Australian and therefore the currency to weaken. For clients that are buying Australian Dollars with Sterling or selling Australian Dollars to buy Pounds, I expect opportunities will present themselves for both clients, therefore I would use a limit order and try to achieve to an extra Cent or two on my exchange.
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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