The Australian economy has suffered of late due to several contributing factors. A main factor influencing the health of the Australian economy is a slowdown in Chinese growth. Australia are heavily reliant on China purchasing its goods and services. The US/China trade war is having an impact on Chinese growth and in turn it is hitting the Australian dollar.

Currency Pair% Change (Month)Difference on £200,000
GBPAUD3.55%AUD $12,900
RBA keeps Interest Rates on hold

Until recently it looked like there could be an end in sight to trade wars with reports suggesting talks had been progressing well and it was hopeful there could be a deal in place by the end of the month. Unfortunately, Trump has changed his stance due to his view that talks were not progressing fast enough. He stated on Twitter he intends to more than double current tariffs on the Chinese.

There are also fears about the housing bubbles being created in high wage growth areas such as Melbourne and Sydney.

These concerns had caused the Australian dollar to weaken against sterling last week as rumours circulated that the Reserve Bank of Australia (RBA) could potentially lower interest rates.

The RBA decided to keep interest rates on hold at 1.5%. This boosted Australian dollar value and saw the pound lose some of the gains from last week.

In the build up to the decision the GBP/AUD interbank rate came very close to breaching 1.89, which proved to be a small window of opportunity for Australian dollar buyers.

There are contract options available to make sure you do not miss out on such opportunities. A Limit order allows you to set a target rate of exchange and should that rate of exchange become available 24hrs a day your currency will be automatically purchased. Please do get in touch if this is something of interest.

RBA monetary policy statement       

Following Tuesday’s interest rate decision, the Reserve Bank of Australia (RBA) released their monetary policy statement. This statement provides justification as to current monetary policy and can provide hints to future monetary policy. These statements are watched closely by investors looking to make a fast buck and due to this the statement can cause volatility in the market.

 

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Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.