The pound had hit recent highs earlier this week vs the Australian dollar as the global economy was feeling the strain of the global virus pandemic.
As a commodity based currency the Australian dollar can often come under huge pressure when the world economy starts to slow down and this happening at the moment. The pound briefly hit a high of 2.08 towards the end of the week before falling to just above 2. It then started to fall once again at the end of the week as investors sold off sterling positions.
Bank of England Announces Economic Stimulus Measures
On Thursday the Bank of England announced an interest rate cut to just 0.1% as well as economic stimulus of £200bn from Quantitative Easing. This provided the pound with some much needed support as it fell to its lowest level vs the US dollar since 1985.
The pound to euro exchange rate also fell to its lowest level since the credit crunch before reversing its losses. However, the pound vs Australian dollar had fallen below 2 at the end of the week as concerns continue as to how the UK economy is going to manage during this unprecedented period.
As we go into next week I fully expect the Pound vs Australian dollar to continue to fluctuate which highlights the importance of using a currency broker when converting your money.
With the market moving by so much a useful tool can be to make use of Limit Orders or Stop Loss orders which allow you to pre-agree an exchange rate. This can be especially useful when the market is moving by so much at the moment.
If you would like more information about exchange rates and would like to compare rates vs using your own bank then contact me directly and I look forward to hearing from you.