This Australian Dollar report discusses factors that could affect AUD exchange rates this week. In the table below you’ll see high to low GBP/AUD exchange rate movement when exchanging £200,000 to Australian Dollars in the last 2 weeks:
|Currency Pair||% Change||Difference on £200,000|
At 04:30 this morning the latest Reserve Bank of Australia (RBA) interest rate decision was released, which saw the rate stay the same at 1.5%. There wasn’t expected to be any movement and statements from members of the RBA over the last few weeks have suggested nothing will change until late 2018 at the earliest.
Governor Philip Lowe delivered a statement after the announcement suggesting that the Aussie’s strength was cause for concern. Lowe pointed out that a weaker US Dollar has led to the AUD’s appreciation and it created subdued price pressures on the economy.
The Aussie has been high flying over the last 6 months however some of that strength has started to unravel as other central banks around the world change their interest rates. Previously the 1.5% was one of the standout returns from a central bank, but there are risks with the AUD due to the influence from China. With this in mind as other central banks raise rates investors can make returns without as much risk. The GBP/AUD is currently residing around the 1.69 level falling below 1.70 for the first time since the 26th September. Despite there being concerns for the Australian economy with inflation rising, there could be further gains for Aussie Dollar sellers as the rate could drop further towards the 1.67 level.
If as discussed earlier in the report Sterling’s gains following the interest rate hike announcement have already happened, then the GBP/AUD could be back at 1.65 before November in my opinion. If you do have an upcoming requirement get in touch with your account manager to discuss your options. It is worth remembering that in the last month alone a £200,000 transfer at the moment buys you an extra $17,000.
For more information on how future data releases could affect your Australian Dollar requirement, call our trading floor on 01494 725 353 or email me here.