Australian dollar update 13/09/2011

[John from Moneycorp]

The AAA-rated Australian dollar is not big enough to stand as a safe-haven currency, but it saw its fair share of inflow last week as investors abandoned the euro in fear of a default by Greece. Investors must have been buying it at least partly for its safety qualities because some of the Australian economic data were quite discouraging.

 

The AIG's performance of construction index showed even more of a slowdown in the sector, falling another four points to a dismal 32.1. Employment, which should have gone up by 10k in August, instead fell by nearly that many.

 

On a positive note, Australian gross domestic product rebounded by 1.2% in the second quarter after a rain-soaked first three months. The main drivers were iron ore and coal production, while domestic demand grew more slowly. The Reserve Bank of Australia held its overnight cash rate steady at 4.75% and offered no hints as to future direction.

[beckdownunder]

Hi John, thanks for the update.

 

We are about to move over in a couple of weeks. We need to move some funds over to start out on, but think we plan to leave the rest in the UK, until we are ready to buy (in the hope that the exchange rate changes). I know you are not a fortune teller and no one can really predict the future, but do you think we will ever get back to the 2:1 exchange rate, or at least nearer to it than we are? Its about 35k we are leaving in the UK, so it makes a massive difference to us even if the exchange rate changes just a little.

 

cheers

[John from Moneycorp]

Hi beckdowunder

Thanks for your message.

As things stand, it will be a fairly long waiting game for a return to $2 to the pound.

Over the next few months, if interest rates were to lower in Australia, as some economists are predicting, this would likely weaken the Aussie dollar.

If you have not already registered with one, I would recommend you use a foreign exchange specialist, such as Moneycorp, for making your transfer(s) to Australia – once registered, you will receive free information and guidance on the currency markets, helping you decide on the best time to buy. A personal dealer will always be available to answer any questions you might have. As we have seen over the past month or so, the Aussie has been fluctuating quite a lot therefore affecting the amount of dollars you could end up with.

Please feel free to contact me directly, via private message, and I would be happy to discuss your situation in more depth.

Kind regards

John