The Pound had another positive day against the Australian Dollar yesterday with rates improving 0.5%. However overnight Trade Numbers and Building Permit numbers where released for Australia and both releases exceeded expectation. GBP/AUD exchange rates have dropped over a cent within the last 6 hours. Trade balance which is the difference in the value of its imports and exports exceeded by over one million. Building permits showed a contraction but far from as bad as economists predicted.
Christmas festivities could be a factor to why corporate investment slowed down under.
Over the last 30 days GBP/AUD exchange rates have fluctuated 6.8% (10 cents). For Australian Dollar buyers a well timed £200,000 conversion would have achieved you an additional 21,780 Australian Dollars compared to the low points. The three main factors that have influenced GBP/AUD exchange rates are Brexit headlines including the Supreme Court ruling, Donald Trump inauguration and commodity prices soaring in China, in particular Iron Ore.
With Theresa May now given approval to begin Brexit negotiations its looking likely an exit from the EU in March will materialise. If the UK leave the single market as well as the EU I feel the Pound will plummet in value in the upcoming weeks. As for Donald Trump his controversial comments could land him in hot water, and if he plans to devalue the US Dollar its likely speculators will flock to the Australian Dollar for the high returns on their yields.
Therefore I wouldn’t be surprised to see GBP/AUD exchange rates fall to the lower 1.60s in the upcoming weeks ahead. In the medium term Australian Dollar buyers we could potentially be at the high end of the market for a period therefore making arrangements may be wise.
With a deadline for Article 50 now expected early in March, The Pound may begin to lose further ground against the Australian Dollar. If you are buying AUD now could be a good time to get in touch with our brokers on 01494 725 353.
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