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Sheena from Moneycorp

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About Sheena from Moneycorp

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  1. Sheena from Moneycorp

    GBP and AUD Update

    Despite trending lower for most of this week, and briefly seeing a slump yesterday, the British Pound to Australian Dollar (GBP/AUD) exchange rate has rebounded from its lows today and ultimately hasn’t seen huge losses this week after all. Demand for the Pound has been limited amid political uncertainty, but the Australian Dollar has seen big shifts in movement this week which have driven exchange rate movement. After opening this week at the level of 1.8710, GBP/AUD has spent the week trending with a downside bias due as the Australian Dollar capitalised on mixed Pound movement. GBP/AUD was almost on track to have lost around a cent and a half as it touched on a three week low of 1.8550 overnight, but after hitting those lows the pair has been recovering. While GBP/AUD continues to trend below the week’s opening levels, it has recovered most of its losses amid fresh Australian Dollar weakness, and at the time of writing was trending closer to the level of 1.8673. The Pound has seen mixed performance all week, and has lacked fresh support as investors focus on Britain’s 2019 General Election race. The election, still over a month away, is expected to see a win for the ruling Conservative Party which is being perceived as boosting the chances of a relatively soft Brexit. However, uncertainty about the possibility of other election outcomes is weighing on the British currency, preventing it from continuing to climb on softer Brexit hopes. On top of this, the Bank of England (BoE) surprised investors yesterday as policymakers were unexpectedly split on UK monetary policy.
  2. Sheena from Moneycorp

    AUD and GBP

    The Pound jumped by a percent against the Australian Dollar Tuesday after the Reserve Bank of Australia (RBA) cut its interest rate to a new record low and hinted strongly of more cuts to come, which some analysts say now risks pushing the antipodean currency to its lowest level for more than a decade. Australia's central bank cut the cash rate to an all-time low of 0.75% Tuesday, in line with the market consensus, citing a continued weakening of the global economy and concerns about the outlook for jobs down under as risks to its inflation target. The RBA said the economy needs a lower rate of unemployment if it is to see the wage pressures that would enable the bank to meet its inflation target, but warned that jobs growth is likely to slow even further in Australia up ahead, even though unemployment has recently risen Changes in rates are normally only made in response to movements in inflation, which is sensitive to GDP growth, but impact currencies because capital flows tend to move in the direction of the most advantageous or improving returns. Those flows tend to move in the direction of the most advantageous or improving returns, with a threat of lower rates normally seeing investors driven out of and deterred away from a currency.
  3. Sheena from Moneycorp

    GBP and AUD Update

    Dragging the Aussie lower was the latest Reserve Bank of Australia policy meeting minutes with guidance pointing to a clear easing bias moving forward. "They no longer talk about an accumulation of evidence in order to ease again, and highlight risks to the global economy,” wrote National Australia Bank senior FX strategist Rodrigo Catril, adding "It certainly sounds a lot more dovish than before.” For Sterling, Brexit remains the key to the outlook ahead of Wednesday's CPI and Thursday's BoE with focus falling on the Supreme Court on Tuesday as they open a case into PM Johnson's prorogation of Parliament. UK and EU officials are also set to resume Brexit talks after agreeing to host daily negotiations in a bid to thrash out a last minute deal. Risk-off was the dominant theme for currency markets on Monday while the GBP was facing the double-whammy of resurgent no-deal Brexit fears as Tory Brexiteers continue to insist the UK will leave the common currency bloc on October 31st. While there was some positivity out of a meeting between PM Johnson and the EU's Juncker in which the leaders agreed to daily Brexit talks moving forward, time's quickly running out to secure an outcome other than no-deal. "The fact remains there is still a decent chance of Britain not able to secure a deal and that is prompting investors to take profits after last week’s rally,” wrote currency strategist Thu Lan Nguyen of Commerzbank. For the Aussie, RBA minutes are due overnight which should set the tone moving forward while currency markets as a whole will likely take their cue from geopolitical risks - with a focus on the US response to the attacks on Saudi oil refineries - as well as central bank policy with the Fed and Bank of England releases likely to impact the cross.
  4. Sheena from Moneycorp

    GBP and AUD Update

    GBP/AUD UPDATE: The Pound to Australian Dollar exchange rate remained on the defensive on Tuesday afternoon, with the pairing trading at around AU$1.7867 in response to heightened political uncertainty in the UK.Markets are currently bracing for the unknown as MPs attempt to pass a bill compelling the government to seek an extension to Brexit, whilst Boris Johnson is preparing to call for a snap election if he is defeated. Helping the ‘Aussie’ to press its advantage was the Reserve Bank of Australia’s latest rate decision, where an upbeat economic outlook helped to boost AUD exchange rates. The Australian Dollar’s period of weakness in August has not been enough to keep the British Pound to Australian Dollar (GBP/AUD) exchange rate climbing, and after markets opened today the pair tumbled once again. The Pound’s volatility is worsening on a mixture of UK economic fears and expectations for Brexit chaos, but the Australian Dollar has been unable to capitalise on Sterling weakness amid global trade fears and anticipation for upcoming Reserve Bank of Australia (RBA) news.
  5. Sheena from Moneycorp

    GBP and AUD

    The GBP/AUD exchange rate is trading at around 1.8084 at the start of the new week having fallen 0.75% in the week before, and we note the pair to be trading in an increasingly narrow sideways range, with a decisive break higher or lower required to define the trend. With a politically-charged week of UK politics lying ahead, we could see some fresh direction injected into this exchange rate over coming days: the question is what are the levels readers should be watching. The Australian Dollar remains a proxy for investor sentiment towards China, and specifically the U.S.-China trade war. The Australian Dollar extended lower on Friday as 'risk assets' fell from favour with investors ahead of a weekend that is expected to yield a further escalation of the U.S.-China trade war although the Antipodean unit is tipped by multiple analysts to remain under pressure for a while to come. President Donald Trump moved ahead Sunday with a new tariff of 15% aimed at the remaining balance of Chinese exports to the U.S. not yet covered by punitive levies, although it will be December 15 before all of the country's trade with the U.S. is fully tariffed. Those exports waiting to be tariffed are worth around $300 bn each year, while the U.S. has $75 bn of exports to China that are set to be targeted in retaliation.
  6. Sheena from Moneycorp

    GBP and AUD Update

    The pound to Australian dollar exchange rate is holding on to its recent gains with rates for GBP Vs AUD sitting at 1.8140. The markets will now focus on all the latest Brexit developments this week with political fireworks expected as we approach the 31st October Brexit deadline. High volatility is to be expected for GBP to AUD exchange rates as parliament will return 3rd September after the summer recess. UK Prime Minister Boris Johnson made clear to MP’s yesterday that there will be no way of stopping Brexit and that Britain will leave the EU at the end of October. There has been much talk of a vote of no confidence which could be issued by leader of the opposition Jeremy Corbyn although whether he could succeed in putting in place a caretaker Prime Minister remains to be seen. There is also the very real prospect of a general election something that could see additional volatility for GBP/AUD. Those looking to buy or sell Australian dollars are likely to see heightened volatility in these coming weeks with a big swing in either direction depending on whether or not a Brexit deal is reached. Those with a sizeable amount to transfer would be wise to consider planning around these developments as the 31st October deadline counts down. There has been much talk of a vote of no confidence which could be issued by leader of the opposition Jeremy Corbyn although whether he could succeed in putting in place a caretaker Prime Minister remains to be seen. There is also the very real prospect of a general election something that could see additional volatility for GBP/AUD. Those looking to buy or sell Australian dollars are likely to see heightened volatility in these coming weeks with a big swing in either direction depending on whether or not a Brexit deal is reached. Those with a sizeable amount to transfer would be wise to consider planning around these developments as the 31st October deadline counts down.
  7. Sheena from Moneycorp

    GBP and AUD Update

    The GBP/ AUD exchange rate is trading at around 1.7727 on Monday, 0.90%b lover than at the same point last week. The pair has started to sell off steeply after rebounding to a multi - week high at 1.82. Although the overarching downtrend is still intact a break back below the trendline is required to confirm the downtrend. We retain a neutral outlook over the next 5 days, with a break higher or lower above various levels required to confirm the next direction of the trend. The most important data releases for the Aussie in the week ahead are employment data on Thursday and Chinese data on Wednesday. Australian employment data is forecast to show a 14k rise in July whilst unemployment is expected to remain at 5.8% when released at 2.30 BST on Thursday. This suggests a slightly positive result. The data could impact interest rate expectations and therefore the Aussie. The Reserve Bank of Australia (RBA) has been aggressively cutting rates of late and this has been pressuring the Aussie lower since lower interest rates tend to weigh on currencies. A worse-than-expected result could increase speculation of a further interest rate cuts from the RBA in September - current market expectations are around 40% of a cut then.
  8. Sheena from Moneycorp

    GBP and AUD Update

    The pound to Australian dollar exchange rate has declined since the start of May with sterling losing value against all major currencies. Last week the Bank of England confirmed that British companies are close to a near record in regards to sterling deposits switched into Foreign Currency for the month of June. The Bank of England’s commentary and the data that supports it shows that businesses within the UK that have exposure to foreign currency are buying upfront due to threat of a no deal Brexit and could be the reason why the pound is continuing to lose value. The ongoing Brexit saga is going to be the key driver for the pound against the Australian dollar in the weeks and months to come. Since the start of May mid market exchange rates have continued to fall. If it’s the case Pro EU MP’s fail to stop Boris from crashing out of the EU, then the pound could see further decline. This was supported by the Bank of England last week, as Governor of the Bank of England Mark Carney warned that the pound could crash on the back of a no deal, and consequently also cut growth forecasts. If you are buying Australian dollars in the months to come and are concerned about how Brexit could impact you, feel free to get in touch with me and I will be able to provide you with guidance on the markets.
  9. Sheena from Moneycorp

    GBP and AUD Update

    The main events impacting the Australian Dollar in the week ahead are likely to be global and geopolitical in nature, with the only local data being a speech from Reserve Bank of Australia (RBA) Governor Philip Lowe. The Iranian special forces boarded and held a passing UK tanker in the Strait over the weekend in retaliation for the UK boarding and stopping an Iranian tanker in the strait of Gibraltar. Whilst further saber-rattling could drive up oil prices, it's not so integrally connected with Australia to spark a rout in the Aussie Dollar, although higher oil prices could become another headwind for the global economy and that could impact the Aussie over time if it came to pass. The major driver of the Pound this week is likely to be the announcement of the winner of the Conservative Party leadership election on July 22, but with little difference remaining between the two candidates' stated Brexit policies, the result may not cause as much volatility as previously expected. Jeremy Hunt is seen as more ‘moderate’ and less likely to take the UK out of the EU without a deal, so his election might provide some relief for Sterling. The opposite is true of Boris Johnson, who is the bookmakers' favourite to win, although such an outcome is likely in the price of the Pound by now.
  10. Sheena from Moneycorp

    GBP & AUD

    The Pound Sterling Australian Dollar (GBP/AUD) exchange rate remained muted and the pairing is currently trading at an inter-bank rate The Pound (GBP) is rangebound against the Australian Dollar and the majority of its other peers this morning, following the release of the UK’s latest housing data. Unsurprisingly, Brexit uncertainty continued to play a role in the dip, with both buyers and sellers seeking greater clarity before making any commitments. Looking ahead to next week’s session, we expect to see the Pound Australian Dollar (GBP/AUD) exchange rate come under pressure following the release of the UK’s monthly GDP figures.
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