Aussie Dollar update for June
Australia's central bank held interest rates unchanged at 6.25 percent on Wednesday the 6th of June, a decision widely expected by investors given the slowdown in inflation seen in the last two quarters. Reserve Bank of Australia Governor Glenn Stevens announced their decision in Sydney on Wednesday 6th of June and because the decision was to leave rates unchanged, an accompanying statement was not issued.
Despite stable borrowing costs buoying consumer confidence and fuelling a housing recovery that could stoke a 16-year economic expansion, the current interest rate was deemed high enough to curb potential inflation pressure. The economy grew at the fastest pace in more than three years in the first quarter, the government said, which may ignite inflation and prompt an interest-rate increase in early 2008.
In the near term, rates are likely hold because inflation is unlikely to rise materially. Having said that, experts expect growth in domestic demand to be very strong, and a rate increase could be likely in the first half of 2008.
For a UK migrant heading to Australia, increased inflation will mean that the cost of living increases as goods and services get more expensive, this is yet another reason why it is so important to implement a finance plan before exiting the U.K. and be fully aware how to get the most out of your Sterling when exchanging to the Australian dollar.
Migration currency specialists HiFX have made the whole financial aspect of your migration as simply as possible, right the way through to opening bank accounts for you on arrival.
When transferring your assets from Sterling to Australian dollars, interest rates and the inflation outlook impact the currency markets and will therefore have a direct impact on a migrants future wealth. But how can you protect yourself if your funds are tied up in your property for example?
Even if you do not have all the funds available, you can buy currency with a forward contract. This is when you fix the rate of exchange at the time with a 10% deposit, but do not have to pay the remaining 90% until you need or have the money available. Rates can be fixed for up to 2 years and a forward contract is flexible to allow for changing time scales. By locking into an exchange rate, you are guaranteeing your future wealth or securing the cost of any purchases in both dollars and sterling.
There is no need to put your self under pressure to change your money in one transaction and many people chose to spread the risk of currency movements by changing their money in tranches. To discuss your requirements in more detail and for a free currency consultation please contact the Migration Team at HIFX plc on 01753 859 159 or by emailing us at firstname.lastname@example.org