This Australian Dollar report will address the factors that could have an effect on AUD exchange rates over the coming weeks. The table below looks at the difference between the rate you would have achieved in Aussie Dollars when purchasing £200,000.00 at the low and high levels during yesterday's trading hours.
|Currency Pair||% Change||Difference on £200,000|
The GBPAUD pairing strengthened by nearly 2 percent yesterday, following weaker than expected inflation data from down under and stronger than expected UK GDP figures, creating a perfect opportunity for any clients buying AUD.
A well informed client of Foreign Currency Direct buying AUD would have received over AUD$7800 more at yesterday’s high compared to the low.
The AUD has been the investor's dream so far this year with its extremely high interest rates making it a popular choice. However, yesterday highlights how quickly things can change in this industry. A well below expectation inflation report means that a rate hike in Australia is for now off the cards. Not only did this weaken the AUD yesterday, but events near term in the US and UK mean that the Reserve Bank of Australia aren’t about to join the group of central banks raising interest rates. I believe that this will prove costly for the AUD and any clients looking at selling their Aussie’s may want to look at contract options which would protect you from further losses.
Shortly after this report goes live this morning, Reserve Bank Assistant Governor Guy Debelle will be delivering a speech. This has the capability weakening the dollar further if his speech is particularly dovish following the inflation report and outlook for future inflation for the remainder of 2017 then I wouldn’t expect the AUD to be able to strengthen. A weak dollar normally helps the export driven economy of the dollar, it just depends how much further the RBA are willing to let it drop.
For more information on how future data releases could affect your Aussie Dollar requirement, call our trading floor on 01494 725 353 or email me here.