Welcome to Pure FX's latest update of the pound to Australian dollar exchange rate. This tells you when it may be the best time to exchange pounds to Australian dollars, for your money transfer!
Sterling strengthens versus the Aussie! The pound to Australian dollar exchange rate has hit 1.7839 today, its highest in 5 weeks, or since November 15th.
To put this into context for you, back on December 4th, the pound was as low as 1.7297 versus the Australian dollar, so it's since risen by +3.13% or +6.25 cents!
Were you to transfer £250,000 to Australia at this exchange rate, you'd get AU$445,975, or +AU$13,550 more than on December 4th.
With this in mind, if you're a Brit thinking of emigrating to Sydney or Victoria, this may be the best time to buy your Aussie dollars!
Aussie Dollar Sinks, as US Fed Lifts Interest Rates
The pound to Australian dollar exchange rate has hit this 5-week high, because yesterday the US Federal Reserve again hiked interest rates, up to 2.5%.
As a result, there'll be higher borrowing costs for loans denominated in US dollars, which make up a big chunk of the global financial market.
So this has fuelled fears that the Fed's hike may slow the world's economic growth, as it's costlier to take out a loan.
This has weakened the Australian dollar, because Australia is an open, export-orientated economy, so vulnerable to slow when the world's economic growth decelerates!
AU Dollar Falls, on Fears Over Australia's Housing Market
What's more, the pound to Australian dollar exchange rate has also risen, because there's concern that Australia's housing market may suffer a "hard landing".
In recent months, Australia's houses prices have fallen fast, as Australians' wages haven't risen as fast as property prices.
As a result, some Australian homeowners may suffer negative equity, where their mortgage is costlier than the value of their house.
This may trigger "the first Australian recession in a generation", according to Saxo Bank's John Hardy this week, thereby lifting sterling higher versus the Australian dollar!
Australian Dollar Weakens, as Oil Prices Decline
Moreover, the pound to Australian dollar exchange rate has strengthened, because the price of oil, a major global commodity, has tumbled.
This week, the price of crude has fallen by almost -8%, to just $46.24 a barrel, as it's thought that America's shale oil producers will continue to boost supply.
Australia though is a major exporter of liquefied natural gas (LNG), so cheaper oil will mean more competition for Australia's LNG producers.
As a result, Australia may have to sell its LNG for less, or sell lower quantities, thereby slowing Australia's GDP growth, and the Aussie dollar too!
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Please bear in mind, this article is Pure FX’s opinion only and does not constitute advice. Moreover, the exchange rates referred to in this article are the interbank rates, which are the rates at which banks and financial institutions buy and sell currency to each other. Therefore these exchange rates cannot be accessed by individuals or SMEs, and are not the same rates that Pure FX can offer. To get a free exchange rate quote, call us on +44 (0) 1494 671800, or email firstname.lastname@example.org.