Pound to Australian Dollar exchange rates continue to float around 1.60 on the exchange, with those selling AUD seeing some of the best rates of the past 3 years.
Despite GBP/AUD falling lower than this back in 2010, the current levels are almost unprecedented when you consider recent history and as such those clients holding Australian Dollars should be protecting the gains they’ve made.
Pound to Australian Dollar rates have always been a more volatile pair than Pound to Euro or Pound to US Dollar and therefore investors will look to make money from the bigger swings we can see on the pair. However, the flip side to this is that the losses can be just as drastic, which mean it is not always easy to predict which way the trend will go, as when it does move it can be aggressive and without warning.
We also need to consider the Reserve Bank of Australia’s (RBA) stance, which has always been to try and control the strength of the AUD, for fear of alienating their trade partners and this is another reason I would be wary about assuming the current spike will continue.
Unemployment and employment change figures released overnight did little to shift GBP/AUD exchange rates, with the pair cancelling each other out.
Unemployment actually improved and showed a figure of 5.6% which was better than expectations of 5.7%, however this positive news was cancelled out by employment change and participation data coming out a little worse than expectations.
We currently find ourselves stuck around the pivotal 1.60 level, which appears to be a key benchmark at the moment. Should levels break through and remain below 1.60 then the rate may continue to tumble but if it remains slightly above then there is room for a fight back up towards 1.65. However, personally I see risks to the down side on this pairing at present with the uncertainty surrounding the UK and as such would not be gambling on an improvement.
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