Economic conditions in China and Global uncertainty forced the RBA to keep interest rates on hold, but remain keen to raise rates in the longer term. What does this mean for those buying or selling the Australian Dollar? The table below indicates GBP/AUD exchange rates for the duration of yesterday's trading session.
|Currency Pair||% Change||Difference on £200,000|
In the early hours of the morning the Reserve Bank of Australia decided to keep interest rates on hold. Sluggish wages and wage growth, and continuing fears over the housing market in Australia were to blame for keeping interest rates unchanged from record lows this month. The RBA haven’t changed interest rates since August 2016, and reports claim that due to the economic conditions in Australia and headwinds from global events, this is unlikely to change this year.
However, this has done little to slow the Aussie’s strength, at the time of writing this report, the GBP/AUD IB (interbank) is just below 1.74, 2 cents from its high a week ago of 1.76. Although the minutes from the RBA interest rate decision talk about the negative effect inflation and wage growth is having on the Australian economy, the RBA are still keen to try and raise interest rates at some point, once these effects have subsided.
As previously mentioned, this is busy week for any clients looking to buy foreign currency with Sterling. The health of the UK economy is on view this week, with inflation, labour and consumer data released this week. This could provide further a boost for the pound this week if the figures are in line with the Bank of England’s recent views, especially on inflation today.
Furthermore, outside of trading hours due to the time difference, there is wage data and unemployment data released in Australia which could help AUD buyers to make up some the ground lost this week. After the RBA’s comments last night, I would not be surprised for this figures to show very little positive movement.
In order to capitalise on an short term gains these data releases could bring, make sure you are in contact with your personal trader who can help set up a contract option on 01494 725353.
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