Our latest GBP/AUD forecast looks at the month ahead for the Pound to Australian dollar rate. The Australian dollar weakness that has seen over 5 cents movement in a week from 1.72 to over 1.77 could be a flavour of the kind of volatility that we can now expect in the weeks ahead as we approach some key pieces of news in the currency markets.
GBP/AUD Forecast: Brexit and trade Wars key drivers for GBP/AUD rates
The key factor is of course Brexit which I will discuss later. However, this more recent movement stems from the news on Trade Wars with Australian GDP, Gross Domestic Product and other concerns around US-China trade concerns. Whilst this more immediate movement has been tempered now and GBP/AUD rates are in the 1.76s, the next week or two could see increased volatility.
The end of this week we are expecting the US Non-Farm Payroll data which can influence more global factors driving exchange rates. Clients tracking GBP/AUD rates could see some movement on the pair once this news is released at 13.30 on Friday. US economic data drives the Aussie because of the way news from the United States can influence global attitudes to risk.
The Australian dollar acts as a key barometer of global attitudes to risk and trade. It will rise and fall according to how financial markets are viewing the latest news. US-China trade wars are a major factor on this, as they influence attitudes to risk and sentiment.
The recent cooling in negative sentiment towards the trade wars had seen the Australian dollar rise and the quick turnaround on the rates highlights just how important it is to make plans in advance if considering a large GBP/AUD exchange in such a volatile market.
December 11th a key date for GBP/AUD rates
Tuesday is the key date on this pair next week with the UK’s Parliamentary vote, this will likely trigger a big move on the GBP/AUD pairing according to how it comes across. Most forecasts have sterling losing value from a no vote since this opens up all manner of potentially negative outcomes for the UK and the pound.
These include Mrs May resigning or being forced out, the possibility of a second referendum or even a general election. It does feel like the pound could be the biggest loser next week, although making predictions on such volatile events as the Brexit and Trade Wars is difficult. The politicians involved cannot make up their minds so how can you, the market or I accurately say what will happen?
If you have a position to buy or sell GBP/AUD then please feel free to make further contact to discuss your options and the market. These events will likely set the pace for 2019 so it is well worth being ahead of the curve and making plans now, rather than leaving it all to the last minute and being caught out.
Thank you for reading and I look forward to hearing from you.
To discuss the upcoming Brexit vote, and how it’s likely to impact GBP/AUD rates please get in touch using the form below. I’ll be happy to get in touch personally and discuss your requirements.