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The Pound vs Australian dollar - 2013


Guest John From Moneycorp

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Guest John From Moneycorp

Good news for the UK this morning – construction activity grew at the fastest pace in nearly six years in August, in another sign that the economic recovery in the UK is gathering pace.

 

There has also been some positive news for Australia which has boosted the Aussie dollar. Australia reported better-than-forecast growth numbers for the April to June quarter. Gross domestic product (GDP) expanded 2.6% during the quarter, from a year earlier.

 

The Aussie dollar has also been stronger against the pound following the RBA statement earlier this week which did not signal any further interest rate cuts in the short term.

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Guest John From Moneycorp

Interesting comments from Chancellor George Osborne yesterday – he said in a speech that the UK economy is “turning a corner”.

 

He appeared to be directing his speech at his opponents, particularly the Labour party, who have been critical of the coalition government’s austerity measures.

 

Time will tell if he has jumped the gun with his bullish comments – there has certainly been some positive signs recently in the UK, however there is still a long road ahead.

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Guest John From Moneycorp

The pound is stronger against the Australian dollar today.

 

There is anticipation, in Australia, that there could be another interest rate cut in the near term.

 

The pound has also reacted well from comments from Bank of England Governor Mark Carney – his personal view is that he doesn’t see a case for quantitative easing stating the UK economy is strengthening.

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Guest John From Moneycorp

The Australian dollar had a good week against the pound.

 

Why?

 

The Aussie was one of the top performers last week, strengthening by a cent and a quarter against the pound. It received help from news of stronger-than-expected Australian retail sales and purchasing managers' index (PMI) readings.

 

Another boost came from the Reserve Bank of Australia, which kept its Cash Rate steady at 2.5% and implied in its statement that it was not planning another rate cut.

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Guest John From Moneycorp

The latest Australian dollar update is below, thanks.

The Australian and New Zealand dollars both had a good week. For the Aussie it meant a cent-and-a-quarter gain against the British pound, two thirds of a cent won from the euro and a half-cent climb against the US dollar.

As the week progressed investors became steadily more confident that the warring politicians in Washington would not drive the United states over the brink of default by refusing to approve an increase to the "debt ceiling", the aggregate limit on the amount the government can borrow. With that in mind they shunned the safe-haven Japanese yen and reinvested in the allegedly more "risky" commodity-oriented currencies including the Australian and New Zealand dollars. The Australian economic data helped that cause; more than 9k more people found work in September and the unemployment rate fell from 5.8% to 5.6%.

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Guest John From Moneycorp

The Aussie dollar had a difficult week. It lost two thirds of a cent to the US dollar, a cent and a quarter to the pound and two and a quarter cents to the euro.

Why?

Two important influences affected the Australian dollar, both of them occurring on Wednesday morning.

The first, and a positive for the Aussie, was a higher-than-expected 2.2% inflation rate. Investors saw it as delaying any move by the Reserve Bank of Australia to reduce AUD interest rates.

The second event, just a couple of hours later, was a negative. There was a sharp sell-off for all the commodity-related currencies in response to a squeeze in the Chinese money market that pushed up short-term rates. Investors feared that the Chinese authorities were deliberately trying to dampen the economy and, with it, Chinese demand for the exports of Australia, New Zealand and Canada.

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Guest John From Moneycorp

The Australian dollar continues to weaken against the pound.

Why is the Australian dollar on a downward spiral at the moment?

Comments from Reserve Bank Governor Glenn Stevens saying Australian dollar remains "uncomfortably high".

News from the US - meeting minutes revealed US Federal Reserve policymakers expect to begin tapering economic stimulus ‘in coming months’.

China - disappointing manufacturing data released. China is Australia’s largest trade partner so any news like this can impact the Aussie dollar.

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Guest John From Moneycorp

Australia's cricket team had a far better week than its currency. The Aussie dollar was by far the worst performer, losing three cents to the euro, five cents to the US dollar and six to sterling.

With no useful Australian economic data to guide them, investors had to rely on the central bankers to give them direction. They got plenty, from the minutes of policy meetings at the Reserve Bank of Australia and the US Federal Reserve and from the mouth of RBA Governor Glen Stevens. The Federal Reserve offered a reminder that its money-printing stimulus programme would begin to wind down "in coming months", thus turning off the money tap that has been so helpful to the Aussie. Governor Stevens said he had "an open mind" about using intervention to weaken his currency, suggesting that the RBA might actually go ahead with it.

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Guest John From Moneycorp

The latest Australian dollar review is below – thanks

 

Life was not as difficult for the Australian dollar as it had been the previous week but it was no success story. The Aussie lost half a cent to sterling. Half a cent to the US dollar and two cents to the euro.

 

Some of the Australian economic data were decent enough. Retail sales were up by a monthly 0.5% in November. Activity in the construction sector grew more quickly and in the services sector it shrank more slowly. Companies' pre-tax profits averaged 3.9% in the third quarter, up from 0.4% in the previous three months.

 

But the figures for third quarter gross domestic product were disappointing. Quarterly growth slowed to 0.6% when it should have accelerated to 0.8%. As usual, the Reserve Bank of Australia was the Aussie's biggest handicap. The RBA said in its monthly statement that "the Australian dollar... is still uncomfortably high".

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Guest John From Moneycorp

The Australian dollar has been boosted by stronger growth data in the fourth quarter of last year.

A government report showed gross domestic product climbed 0.8 per cent in the fourth quarter from the third and 2.8 per cent from the same quarter a year earlier.

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Guest John From Moneycorp

Hi all - weekly GBP/AUD review below, thanks

It was a much better week for the Australian dollar.

Although it was not quite top dog it was up there with the leaders, strengthening by a cent and a half against the US dollar and by two against sterling.

It was the improved Australian ecostats that did the trick: the figures for new home sales, manufacturing, building permits, retail sales, the trade surplus and economic growth were all better than expected.

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Guest John From Moneycorp

The Australian dollar has been much stronger against the pound. It was boosted by comments from Australia Governor Glenn Stevens.

 

Stevens talked about a prospective housing boom and a shift in economic emphasis away from mining and towards other industries - the Aussie strengthened by a cent against sterling.

 

In addition, it was boosted by news from China, speculating they may accelerate stimulus measures to boost its economy. China is a key trading nation for Australia therefore any news from there can impact the exchange rate.

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Guest John From Moneycorp

There has not been much currency related news of note over the weekend/today.

Worth keeping an eye on the monthly Reserve Bank of Australia (RBA) Rate Statement on Tuesday morning – in this statement, the RBA announces its policy on interest rates.

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Guest John From Moneycorp

The latest currency update is below, thanks.

 

The Aussie did not begin the week well, losing three cents to sterling in two days, but it staged a modest recovery after that, leaving it a cent lower against the US dollar and the euro and more than two cents weaker against sterling. As is often the case, the Australian dollar's biggest handicap was its central bank. In this instance the damage was done by Guy Debelle, an assistant governor of the Reserve Bank of Australia, and by the minutes of the recent RBA policy meeting.

 

The minutes confirmed that Australian interest rates will remain at a record low "for some time yet" and Mr Debelle said in a speech that a decline in capital inflows would be likely to weaken the Australian dollar. It did not help that his comments came hard on the heels of a warning from Standard and Poor's that Australia could lose its AAA credit rating if government spending cuts are not put into effect.

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Guest John From Moneycorp

The Australian dollar remains strong against the pound – the graph below shows the change in the exchange rate over the past week.

 

http://www.pomsinoz.com/forum/attachments/money-transfer-ask-moneycorp/26011d1408699295-pound-vs-australian-dollar-aud.png

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Guest John From Moneycorp

The pound is under pressure following a poll this week which showed an increase in support for Scottish independence.

This poll has caused uncertainty over the future of the United Kingdom - this has led to the pound weakening against most currencies including the Australian dollar.

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Guest John From Moneycorp

The Australian dollar weekly review is below – have a good weekend everyone.

 

Among the major currencies the winners were the US dollar and the British pound, with the Australian dollar not far behind. The Canadian dollar was among the back-markers, alongside the NZ dollar and the euro. The specific link between the three leaders was strong national employment data.

 

Last Friday's US figures, which showed the number of people on nonfarm payrolls increasing by far more than expected, sent the Aussie (and the Kiwi) sharply lower, the logic being that more jobs mean more chance of a rate increase next month.

 

The Aussie got its own back on Thursday, when figures showing Australian unemployment falling to 5.9% with the addition of 58.6k new jobs sent it sharply higher.

 

That still left the Australian dollar a third of a cent lower on the week against sterling and down by a dozen ticks against the US dollar. However, the damage was far less than that done to the other Commonwealth dollars.

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