Pound remains strong against the Australian Dollar
The pound fell against a number of different currencies during yesterday’s trading session. However, the pound did manage to stabilise against the Australian dollar later in the day.
It has been reported that a dozen Tory MPs could potentially look to support a vote of no confidence in the government, if the UK heads towards a no deal Brexit. If this happens this could also lead to a general election.
Generally speaking a currency will often weaken in uncertain times but the pound has managed to stay strong against the Australian dollar. I think this is mainly to do with what is happening with the economy down under.
AUD under pressure against GBP as RBA look to cut interest rates
Average house prices have been falling and unemployment appears to be rising. There are also problems with inflation and the RBA has cut interest rates recently. The current rate of interest is 1.25% and I think we could see further interest rate cuts later this year.
Although the Australian Dollar was given a brief period of respite following the federal election the gains were limited. The focus now moves back to the economy and this is why I think we’ll see more rate cuts coming.
With the US-China trade wars continuing to rumble on global tensions are still rising. Trump has also threatened sanctions on Iran and this has helped to strengthen the US dollar. However, as the Australian dollar is a commodity based currency this will often weaken as investors tend to reduce their risk appetite.
Overall, I think we will see further problems ahead for the Australian dollar. Therefore, if you’re considering selling Australian dollars in the near future then it may be worth getting this organised soon.
Having worked in the foreign exchange industry since 2003 I am confident that I can save you money compared to using your own bank. If you would like a free quote when buying or selling Australian Dollars then contact me directly and I look forward to hearing from you.