If there is progress in Brexit negotiations expect the pound to rally. Unfortunately very little progress is being made. The current point of contention is the Irish border deal.
The Reserve Bank of Australia is loosely looking to raise interest rates in the future which would help the AUD to rise. It has risen overnight following the commentary that saw them raise their Inflation and Growth forecasts.
Another factor to drive the Australian dollar is the outlook on the Trade Wars which have seen the Australian dollar rising according to the viewpoint on how it will influence the Chinese economy. Recent rising expectations that the Trade Wars would gently resolve themselves have cooled but the initial fears that saw the Aussie massively sold off, have subsided.
Global Issues remain I expect the Trade Wars will continue to provide concern, it seems more likely than not that Donald Trump will trigger some kind of concern on global financial markets which would weaken the Australian dollar.
If not owing to economic concerns abroad, it might be political concerns domestically in the US which drive the Aussie.
The recent mid-term elections saw the US dollar lose ground against most currencies with the Australian dollar a beneficiary of the uncertainty. The Aussie did rise on this news, as investors sought to diversify their currency exposure away from the US and possible political issues ahead.
As you can see, there are numerous global factors which drive the Australian. Trying to accurately predict what the rates will be will involve accurately predicting not only what Donald Trump might do, but also how the market might react to it. Some might suggest Donald Trump does not know exactly what he will do next, trying to predict him will be no easy feat!
Westpac do not think so, with them believing the RBA will hold through and Whilst the pound has been notably buoyant across most currencies, rising to some of the best rates all year or certainly multi-week or month highs, the pound to Australian dollar rate has not performed so well.
Whilst we are tracking improved levels, we are still down owing to the Australian dollar also performing well. Current rates of 1. Mix into this the uncertainty on Brexit who can accurately predict the outcome there either? My general expectation is that the pound will rise further against a weaker AUD if the global concerns continue on Trade Wars.
Will you need to make a transfer? For clients with a position selling Australian dollars for pounds, I feel gearing up to capitalise on the recent spike is sensible.
Clients buying AUD with sterling might wish to take a slightly more speculative view but in hoping for further improvements, they could easily get caught out relying on a smooth Brexit process. If you have a position to buy or sell AUD for sterling I would be most interested to share some of the latest news and events driving this pair.
Thank you for reading and please contact me to discuss further.The rupee weakened further on Thursday, closing past the mark against the dollar for the first time ever as foreign funds continued to stream out of emerging markets on expectations of higher U.
Aug 20, · Watch video · The dollar extended its slide ahead of low-level trade talks with China, and the year Treasury yield rose for first time in three .
This trade deficit weakens the US dollar relative to other currencies since forein goods are denominated in foreign currency, thus demand for foreign goods increases the demand for foreign currency and decreases the demand for US dollars.
This causes the US dollar to depreciate.
We look at three important factors that affect U.S. dollar value, and how to determine when it's the right time to buy currency. US Dollar Weakens But Not Enough to Complete the Wave. by Jeremy Wagner, CEWA-M, Head Forex We focused on the Elliott Wave pattern for EURUSD among other US Dollar pairs.
According to . Get the latest news and analysis in the stock market today, including national and world stock market news, business news, financial news and more.