AUD buyers saw a welcome bonus last week when the RBA cut Interest rates to a record low 1.75%. Chinese data this weekend could see further strength for GBPAUD pushing rates closer to the 2.0 mark. GBPAUD has moved by 7.7% in the last month.
China used to be the buzzword when discussing GBP/AUD exchange rates. The two near crashes in their financial markets last year and the subsequent abandonment in confidence for the Australian Dollar allowed rates to hit 7 year highs only last September.
Yet the UK Referendum and most recently the interest rate cut in Australia have been the major influencers on exchange rates. The latter being the reason why most who had a benchmark of buying Australian Dollars at 1.84 last month found themselves immediately driven back above 1.90 in a matter of days.
But China is still prevalent, if not on the front page of the news headlines, and we will likely see some movement following this weekend to reflect this with the upcoming releases on Saturday. This is their own look at retail sales and industrial production.
Due to the opaque nature of their economy, data releases are few and far between, so any glimpse tends to have an exaggerated effect on the market place, and particularly for Australian Dollar rates due to their close trading relationship with China.
Should this data, particularly for industrial manufacturing, come in poorly, then we may come in on Monday morning UK time to find that Asian trading has pushed GBP/AUD close to 2 for the first time since February, presenting some tempting opportunities ahead of the uncertainty surrounding a Referendum vote in June.
With GBPAUD rates in the high 1.90s now is a good time to purchase AUD with GBP. In the event Chinese data comes in strong over the weekend rates could move closer to the 2.0 mark. Speak to one of our brokers today about options, wed love to assist you in getting the best exchange rates. Call us on 01494 725 353 or email me here.