financial advisors in the know??

[michele'n'michael]

Hello to anyone who can help!!
Do any financial advisors etc have a educated prediction on how the exchange rate is going for changing money from £££ to $$$Au??
Is it up or down, good or bad for us wanting to change money when emmigrating??
Thanks Michele x

[Life on easy street]

To be honest no one can predict with 100% accuracy what the exchange rate will
Be in the future.

But in my opinion the general trend line is downwards for the U.K pound.
With an occasional upward blip on the way down.

The finance Times & Sunday Times are usefull for information on exchange rates
most libary,s have these.

hifx are currency brokers i am sure they have an opinion.
http://www.hifx.co.uk

[Liam]

Oh If only we had a crystal ball. The Aussie Dollar has been very high against the USD and GBP for a prolonged period and this may last even longer if Interest Rates here in OZ go up and UK and US interest rates continue to drop under pressure to stem the economic downturn caused in part by the Sub-prime crisis.

The Aussie Dollar is also strong because of the Resources boom which sees a very high demand for our metals, iron ore, gas and coal to support China and India economic expansion. The IMF announced to-day that they expect China to grow by 10% next year which will support continued demand for Aussie Exports which may mean a strong Aussie Dollar will be around for a while.

In the last six months the minimums and maximims have been

min = 2.18 (January, 16)

max = 2.53 (August, 20)

avg = 2.33

So short to medium term if you need to get money over to Australia then I would suggest you drip feed it across weekly or monthly to try and get an average rate.

Long Term the Aussie Dollar is overvalued and will drift lower back towards its PPP (Purchasing Power of Parity)

Technical bit explained : The purchasing power parity (PPP) theory uses the long-term equilibrium exchange rate of two currencies to equalize their purchasing power. it is based on the law of one price: the idea that, in an efficient market, identical goods must have only one price.

For example a Big Mac costs about $3.45 here which is GBP1.54 but it actually costs about GBP1.94 in UK. So it is much cheaper to buy a Big Mac here in aussie dollars at the moment but eventually it will move towards the same cost as in British pounds.

OK so what I am trying to say is that the Aussie Dollar is over valued at the moment but this is being supported by higher interest rates, the resources boom and deman for the currency. This will turnaround but I do not think it will happen in the short term.

So I would suggest you get advice for your own particular situation but think about drip feeding the funds acorss to Australia when needed rather than in a big lump sum. Better to get your money over bit by bit than wait in hope of better rates and find you need to move funds quickly at a bad time!

If anyone has got through all that and not fallen asleep I hope it was of some help.

regards

Liam

[ginny]

Hiya hope you dont mind.
I am moving over begining of april, and intend to leave the bulk of money in the uk for fear of losing against exchange rates, commisions etc. I assume until I make that decision which confirms that ozzie is for me permanently I believed I would lose money by toing and froing. Any suggestions. And if I could impose a little more any advice on a nhs pension. It is all mind bogging and foreign to me.
cheers

[Liam]

Ginny

You are right to wait until you are sure but even then please consider moving the funds over in lots of say 10-20% over 6 months to get soem protection from exchange rate movements. Talk to someone like HIFX about your options.

Re you NHS pension. First step is always to get a Transfer/Rollover Statement from the provider showing the payout figure and the fees and charges or penalties applying. The UK pensiuon maybe too good to gibe up!

Secondly wait until you are sure you are happy here. Now you will hear some of the Pension Transfer "Specialists" tell you that you have to pay 15% tax on any growth in your UK Pension after 6 months in OZ. Its true but its just scare mongering..the truth is earnings on Aussie Superannuation are taxed 10-15% (depending on capital gains relieve and franking credits) until you start an income stream at or near retirement. This means that the 15% on the UK growth after 6 months only puts you in the same position as you would have been had you moved the funds from the UK in the first 6 months.

Get some decent advice once you are over here and make sure it covers your personal circumstances and your needs and objectives short and long term.

Hope this helps

Liam

[ginette]

Cheer liam and very much appreciated. Unless I am spending finance is not my favourite subject but I dont want to lose what I have managed to save and invest , again cheers
ginny