Exchange Rate Forecast for the Pound Sterling vs the Australian Dollar
Thursday: The Australian Dollar exchange rate fell against other currency majors on Thursday as investors anticipate an RBA rate cut in the near future.
The price of gold also softened, pulling the Australian commodity currency lower. In addition, Australia’s Import Price Index dropped by 0.9% QoQ in the three months through December.
Forecast: Friday will see the release of Australian Private Sector Credit and Producer Price Index.
A quick foreign exchange market summary before we bring you the rest of the report:
On Sunday the Euro to British Pound exchange rate (EUR/GBP) converts at 0.856
The live inter-bank GBP-EUR spot rate is quoted as 1.168 today.
The live inter-bank GBP-USD spot rate is quoted as 1.25 today.
The live inter-bank GBP-NZD spot rate is quoted as 2.103 today.
Please note: the FX rates above, updated 28th Apr 2024, will have a commission applied by your typical high street bank. Currency brokers specialise in these type of foreign currency transactions and can save you up to 5% on international payments compared to the banks.
Pound to Australian Dollar Exchange Rate Forecast
The British Pound to Australian Dollar rate rose to the best conversion level of 2015 in heavy trading at the start of this week on the back of no fresh UK data.
Data so far this year has been very poor from the UK economy and the absence of any fresh disappointments helped the Pound to record a decent day’s gain.
All eyes will now be on the first reading of UK GDP (Gross Domestic Product) later on this morning to see how the UK economy fared in the final quarter of 2014. Any fresh disappointments could see the Pound soon give up yesterday’s gains.
Of interest yesterday, Bank of England (BoE) Monetary Policy Committee (MPC) member Kristin Forbes said yesterday that the MPC could raise UK rates sooner than expected. Forbes believes there was a "higher probability" of scenarios in which UK inflation falls in the short-term future before rebounding more strongly than expected.
UK interest rates have been kept at their all time record low since of 0.5% since March 2009 and following the publication of the lowest inflation data out of the UK for 14 years earlier this month, the vast majority of analysts do not expect to see a UK interest rate rise before 2016.
Of interest, Forbes also confirmed that the MPC will be monitoring the Federal Reserve's actions closely. With the US economy rebounding strongly, analysts are expecting the US Federal Reserve to possibly move on US interest rates as early as June 2015.
In the absence of any meaningful data to move the markets yesterday, the centre of attention remains the Euro, still reeling from the announcement by the European Central Bank (ECB) last week on launching a much more aggressive Quantitative Easing (QE) program than had been forecast and the weekend’s election result from Greece.
Yesterday was Australia Day, a public holiday in Australia and the Australian markets were shut.
The Pound Sterling to Aus Dollar (GBP/AUD) exchange rate approaches a yearly highly last seen on 20th December 2014
GBP/AUD Exchange Rate Short-Term Outlook
Of interest, Austrade reported that Australia has now recorded 23 years of uninterrupted economic growth at an average annual rate of 3.3%.
In the last decade, Australian economic production has grown to AUD $1.5 trillion, representing 1.9% of the global economy in a country with only 0.3% of the global population.
All very nice except as far as the Dollar is concerned, analysts are still predicting that the Reserve Bank of Australia could cut rates at their next meeting a week today on 3 February and with the ongoing rout in the world commodity markets and continuing slowdown in China, by far and away Australia’s main trading partner, there seems every likelihood that the highly volatile start to the financial markets in 2015 will carry on for at least a while yet.