Further falls for GBPAUD exchange rates
Over the last four weeks GBPAUD exchange rates have been on the decline. The ongoing Brexit saga is forcing investors away from Sterling due the uncertainty. This week Trade Secretary Liam Fox announced that he believed there was a 60% chance of a no deal. In addition, the Bank of England hiked interest rates last week and a dovish monetary policy statement followed by the Governor Mark Carney which stopped the Pound from making any sort of recovery.
Even though GBPAUD exchange rates are on the decline, the Australian Dollar is facing problems of its own. Yesterday, the Reserve Bank of Australia kept interest rates on hold for the 24th consecutive month at a record low of 1.5%. Shortly after, Governor Philip Lowe explained that the housing market in Sydney and Melbourne continues to slow, housing credit growth has also declined and inflation remains below the Reserve Bank of Australia’s target.
For clients that are converting Pounds into Australian Dollars I wouldn’t be surprised to see GBPAUD fall to the low 1.70s in the next 3 months due to the strain of Brexit. The UK and EU have set the deadline of October to have a deal in place, but time is ticking and with UK MPs on holiday until early September, it appears that a considerable number of decisions need to be made in September.
Short term, the key data releases to look out for which will impact GBPAUD exchange rates are the monetary policy statement by the RBA in the early hours of the morning this Friday and UK GDP numbers on Friday morning. Personally I expect the statement to be fairly dovish, which will weaken the Australian Dollar against the Pound, however the UK GDP numbers are set to drop from 0.2% to 0.1%, therefore the gains could be short lived. As the data is set to be released overnight, if you want to try and catch the market on a spike, it may be worth placing a limit order with us. This means you tell us the rate you want to achieve and our system will buy your currency if we get to that level.
Feel free to get in touch for more information about the outlook for Sterling and the Australian Dollar, send me an email at [email protected] and I will be happy to discuss your upcoming requirements.
The post Further falls for GBPAUD exchange rates appeared first on Pound Sterling Forecast.
Source: https://www.poundsterlingforecast.com/2018/08/further-falls-for-gbpaud-exchange-rates/
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