Category Archives: AUD

How well do you really understand what is driving your exchange rate?

The pound looks likely to rise against most of the major currencies longer term as the UK appears likely to raise interest rates in the future. This is important because the raising and lowering of interest rates by a central bank greatly affects the strength or weakness of a currency. Understanding this fact – that the raising and lowering of interest rates greatly affects the strength and weakness of a currency – is key to predicting where exchange rates are headed.

One of the major reasons for GBP strength in 2014 is high expectations the UK would raise interest rates in 2014. This expectation has been pushed well back into 2015, if not 2016 and anyone holding on for this to happen to make an exchange had better have a long time to do so! I remember in 2012 we were almost in an identical position , with expectations high the UK would raise interest rates in the coming year or two. We then had the Eurozone crisis deteriorate (remember Greece on the brink of leaving the Eurozone) and the following Spring the UK entered a triple dip recession and the pound crashed from 1.24 to 1.14 in about 6 weeks!

I do not think we are likely to see such a sharp move but with the General Election and increased political uncertainty on the cards for 2015 a tough patch for the pound appears highly likely. Even though May 2015 seems many months away it is not actually that far in terms of exchange rates. Considering you have seen anywhere from 5-15 cents movement per year for the last few years on GBPEUR, making some plans now for currency in the new year is clearly sensible. 

We offer a range of contract options to fix exchange rates at currency levels and also to automatically purchase when a desired rate is hit (stop / loss and limit order). Speaking with or emailing us with a brief outline of your situation carries no obligation. We are currency specialists who are here to assist in the safe planning and execution of your transfers.

The real risk on exchange rates is doing nothing and leaving it all to chance so to learn more please contact me Jonathan on jmw@currencies.co.uk,

I look forward to hearing from you.

Thank you,

Jonathan

GBP Dips are worth capitalising on!

If you think recent drops on sterling were bad you should prepare for worse as these moves are likely to be extended in the future. Next year is a tremendous amount of uncertainty as to where the political situation in the UK will head.

If you are debating any currency transactions why not speak to one of our specialists regarding all of your options. Remember that you can forward buy your currency locking in current levels and rates. I would expect a recovery in  sterling down the line andI feel therefore current levels represent a very good opportunity to sell Euros for sterling.

If you wish to learn more about your situation why not email me Jonathan on jmw@currencies.co.uk

Sterling’s forecast change – Dust settles on Quarterly Inflation Report

GBPEUR rates changable again today as UK data shocks the market. This morning was a busy day for the UK with some of the most important information released on the economy for the month or even for the remainder of the year.  Firstly the UK released Unemployment figures including the overall percentage of unemployed, the new numbers claiming benefits and the wage increase figures.  All rather important for an economy and generally an improvement was shown which in turn pushed up the value of Sterling.  Thereafter we had the Quarterly inflation Report held by the Bank of England. This is particularly important as it gives the market the latest estimates and forecasts of the bank on the economy. So information on Inflation, growth and wage increase; all key to any potential timing of an interest rate change.

Interest rates are key to currency markets as it drives the level of investment in the country and therefore its value due to changing demand. So if interest rates are brought forward, investment starts to climb strengthening the currency in questions. Unfortunately the opposite happens to, so if interest rates are pushed back we see investment fall and the value crash.

This morning’s information has changed expectations and as a result the currency market has changed. For more information on what was covered and the impact on your currency position please feel free to contact us, especially if you are a regular reader and have not put a voice to our names yet. My name is Steve Eakins, I have been trading in the currency market for over 6 years now and am happy to help if you wish. Contact me directly via email at hse@currencies.co.uk or feel free to call on the number at the top of the page and ask for myself.

Happy trading!

We will remember them (Daniel Wright)

Just a quick note from all at Pound Sterling Forecast to show our support for armistice day…  remembering the brave. We will be observing the two minutes silence today so if you do try to call please be aware we may not answer at 11.00am.

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Sterling exchange rates remain fairly flat in trading today – Potential for Swiss National Bank to step in on the Franc again? Wage inflation key for Sterling this week (Daniel Wright)

The Pound has had a reasonably quiet day on the market against most major currencies gaining a little ground back against the Dollar after dropping to a 14 month low last week.

The main news of the day for the currency markets was growing speculation of the SNB (Swiss National Bank) possibly stepping in to devalue the Swiss Franc again as it is hovering dangerously close to the 1.20 mark against the Euro. The SNB have artificially attempted to keep the EUR/CHF rate above 1.20 for a number of years now and with the rate currently sat at the lowest point since November 2012 a move to alter this may be in the pipeline. Should the SNB actually look to do this then we may see the Swiss Franc drop against most major currencies so Sterling exchange rates against the Pound could spike up nicely.

The key for Sterling exchange rates in my opinion this week will be the wage inflation figures due out on Wednesday morning. Wage inflation is one of the most important factors towards an interest rate hike as although the economy does appear to be picking up, unless peoples wages are following suit then we are actually not moving too far in the right direction. Governor of the Bank of England Mark Carney has added in recent comments that wage inflation is vital for an interest rate hike so should this be moving in the right direction we may see the Pound have a good day although unemployment figures and the inflation report also have the potential to counter this.

If you are looking to carry out a currency transfer in the near future involving either buying or selling the Pound then it will be well worth you emailing me directly. I have now had thousands of clients contact me through this site and they have found that they are getting a smoother, more efficient service than their bank or current broker along with a better rate of exchange by using me. You can email me on djw@currencies.co.uk with a brief description of what you are looking to do and I will be more than happy to assist you.

Interest Rates & US Non Farm Payrolls (Tom Holian)

Sterling has dipped marginally against the Euro and the US Dollar over the last couple of trading session as UK interest rates were kept on hold. ECB President Mario Draghi did suggest that if unemployment levels remain high this could mean intervening in monetary policy in short term. However, the absence of any change in policy yesterday allowed the Euro to regain a bit of strength.

US Non-Farm Payroll data which has just been released confirmed that 214,000 new jobs have been created in the US  which led to a brief bout of Dollar strength but this has since disappeared as the levels were not as different as expected.

However, the jobless rate of 5.8% is now the lowest since July 2008 so I think we will see Dollar strength going into Monday morning’s trading session.

Janet Yellen is due to talk later this afternoon and depending on her rhetoric I think the Dollar will strengthen against both Sterling and the Euro.

Over the weekend there is a large amount of data for China which could have a big impact on GBPAUD exchange. During the week GBPAUD has tipped past 1.85 and although rates have fallen today for Sterling I think we’ll see an improvement by Monday.

If you have a currency transfer to make and want to save money on exchange rates compared to using your bank then contact me directly for a free quote. Tom Holian teh@currencies.co.uk

 

 

 

 

Sterling Australian Dollar Rates (Tom Holian)

Sterling Australian Dollar exchange rates have rocketed throughout today’s trading session to rise by almost 2% which is the biggest daily rise we’ve seen all year.

The morning began with some very poor Australian trade deficit figures which showed it had doubled to AUD$2.2bn in September. Market expectations were for AUD1.95bn so such a difference caused a shock to the currency markets.

Demand for Australia’s natural resources has decreased recently and with the price of iron ore falling by 40% this year this has also led to less money coming into Australia.

Australian unemployment has increased from 6.2% from 6.1% and with this news it means the RBA will be less likely to move interest rates in the near future which is one of the reasons why we have not see GBPAUD rates move as much as some may have expected.

AUDUSD rates have fallen to a 4 year low and GBPAUD exchange rates are getting close to the highs last seen in February.

With October’s unemployment rate due out tomorrow morning we could see further Australian Dollar weakness.

If you have a currency transfer to make and want to save money on exchange rates compared to using your bank then contact me directly for a free quote. Tom Holian teh@currencies.co.uk

 

 

 

 

Sterling exchange rate forecast – The coming days and what may happen to the Pound (Daniel Wright)

Sterling has had a mixed week against most major currencies, slipping slightly against the Euro and the Dollar yet making minor gains against the Australian Dollar, New Zealand Dollar and Canadian Dollar.

As far as U.K economic data goes we had manufacturing data for the U.K which was fairly positive however construction and services data has been reasonably negative so the U.K has not had the best start to the month as far as economic data goes.

We still have some extremely key releases to come out this week with the main focus for anyone looking to buy or sell the Euro being the European Central Bank interest rate decision and press conference. For the past few months we have seen the Euro generally weaken during ECB rate decisions and the press conference thereafter due to the continued concerns of deflation in the Eurozone and head of the ECB Mario Draghi taking actions to try and counter act this. Recent European inflation figures actually suggested that what is being done at present is currently working as inflation has risen back up a little.

This may well be commented on in the ECB press conference tomorrow so if you have Euros to buy then this has the potential to give the Euro strength – The press conference is due at 13:30pm tomorrow and usually goes on for around an hour with the rates being exceedingly volatile during this period as investors hang off of Mario Draghi’s every word.

Overnight tonight we have the unemployment rate due out in Australia which could lead to sharp movements for the Australian Dollar outside of our trading hours tonight. Expectations are for the unemployment rate to remain at 6.1% so any change to this may bring quite a lot of market movement. With employment figures for New Zealand earlier in the week moving the New Zealand Dollar by two cents overnight it is certainly a release to be aware of.

Overnight on Thursday we also have the RBA Monetary Policy Statement in Australia which will inform us of any future economic policy to be introduced by Australia and any comments in it may lead to another volatile night for the Australian Dollar. Over the past few months Governor Glenn Stevens seems to have changed his mind like the wind on how happy he is about the strength of the Australian Dollar, the main view though being that he feels it is slightly overvalued so more comments like this may weaken the AUD and p[resent a buying opportunity.

Friday is a busy day for all major currencies. First and foremost we have the Trade Balance figures out for the U.K which will show the balance between imports and exports for the U.K economy for September a positive value shows a trade surplus and would be seen as positive for the Pound.

Later in the day we have Non-Farm payroll data from America and this can have an effect on all major currencies. It is a measure of the number of people in Non-Agricultural employment in America, Non Agricultural due to the fact that this can be seasonal. The reason it has an effect on all major currencies is because it can alter global attitude to risk and the figures predicted can quite often be quite a way out, so be sure to have a keen eye on exchange rate movements at 13:30pm on Friday.

Finally over in Canada we have their unemployment figures with expectations of a small rise from 6.8% to 6.9% which may be a negative for the Canadian Dollar.

If you are looking to carry out a currency transfer in the near future it may be prudent to let me know sooner rather than later so that I can keep you fully up to date with market movements. We also have a range of contract types available inclusive of forward contracts, stop loss and limit orders email me on djw@currencies.co.uk if you would like more information on how these orders work.

Should you find my updates helpful and interesting yet you have not yet registered an account with me then opening an account is completely free, carries no obligation to trade and puts you in the position to book out a rate as and when you wish. If you are currently using another broker or your bank then it is well worth getting in contact  with me for a comparison as I would be highly surprised if I cannot save you money over your current currency option. All you need to do is email me (Daniel Wright) on djw@currencies.co.uk with a brief explanation and a contact number and i will be more than happy to contact you personally.

 

 

 

What to look out for on the pound in the coming months…

When considering making a currency exchange an understanding of what is driving the exchange rate is vital to getting the most from the market. How can you make a decision on when is the right time to enter the market if you don’t know what is happening? The idea of this blog is to provide information on just where rates are headed and make sure you get the best price when you do decide to enter the market.

Sterling has done really well this year as the UK economy improves and investors position themselves for the UK to raise interest rates. Next year we would expect the UK elections to move the market, the increased uncertainty surrounding the political situation in the UK is bound to cause ripples on exchange rates. If you have a transaction that you need to consider why not get in touch with our specialist team to find out more about moving money internationally at the very best rates.

Please contact me Jonathan on jmw@currencies.co.uk for a quick overview of your position

How will UKIP affect sterling?

UKIP continue to make gains in polls and are certainly likely to be a thorn in the side of the more established parties, indeed they already have been. But is this more a reflection of the tough times ahead for the UK (and the pound) or a flash in the pan protest vote?

UKIP have the power to severely undermine confidence in sterling. there is tremendous uncertainty posed by a party with no solid economic idea from what I have seen. Aside from promising to withdraw from Europe and playing on peoples immigration fears it is difficult to find concrete policy. Let it be known that any withdrawal from Europe would have wide reaching consequences for the UK economy and hence the pound. Whilst it might be welcomed we examine the relationship with Europe the economic benefits of being part of Europe should not be underestimated.

We shall learn much more about the true effects of UKIP on the pound in the next few months as we have bi-election and then the General Election in May 2015. The effect on sterling from increased political uncertainty will undoubtedly be negative and anyone hoping to see sterling keep climbing in 2014 and beyond might be disappointed.

To keep up to date with the pound and how important events affect your exchange please contact me Jonathan on jmw@currencies.co.uk

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