Getting the best exchange rate can be achieved by understanding what is driving rates and the service of a specialist currency broker. Below are movements in just a month affecting Australian Dollar rates when buying £200,000 at the high and low points during the last 7 days:
Benefitting from consistently positive economic data the Aussie dollar has been on a remarkable run of late, having gained by almost 5% against the Pound since the start of July.
However, the Aussie was stopped in its tracks on Friday as investors were put off by the lack of commitment in deputy governor Debelle’s statement. It seems the market had potentially assumed that the Reserve Bank of Australia would capitalise on the consistent growth shown by the Aussie and commit to raising interest rates in line with its currency counterparts around the world.
Clearly conscious of protecting Australian exports, Debelle made it clear however that the RBA would not be pressured into adapting its monetary policy as a result of external factors. As a result, investors pulled their funds away from the Australlian Dollar and pushed them into currencies that will offer higher returns on investment, allowing the pound to break out of its downward spiral and rise by 1% over the course of the evening, making a $200,000 transfer £1,100 cheaper.
Political instability in the UK remains the key driver for AUD strength over the pound however and I see very little reason for Sterling to establish any kind of real drive against the Aussie, particularly as there are still only positive vibes coming out of the Australian economy. Wednesday looks set to provide volatile GBP/AUD exchange rates with key inflation and consumer spending data due out on both sides. I expect the Aussie to come out on top however as the UK’s battle with rising living costs should once again begin to weigh on Sterling’s value. As such, clients looking to buy Aussie dollars with pounds might want to consider capitalising on Friday’s gains before they disappear.
Thank you for reading my Aussie Dollar report, if you have any questions about an upcoming transfer I would be more than happy to discuss them – you can contact me with any queries here.
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