John from Moneycorp

Monthly currency review is below – thanks. It was a totally average month for the Australian dollar. It weakened by 5.1% against the all-conquering British Pound, exactly the proportion by which, on average, the other dozen most actively-traded currencies fell. The Aussie faded by 0.5% against the NZ Dollar and it was down by a rather more significant 3% against the US Dollar. Political and economic developments in Australia were more than a little overshadowed by the goings-on elsewhere. America's presidential election delivered a result which, in terms of its surprise value, exceeded even Britain's vote to leave the EU. Investors' initially-negative thoughts on the matter quickly turned positive when they considered where his policies might lead. Tax cuts and increased spending on infrastructure, should they materialise, would logically mean greater government borrowing, higher spending, accelerating inflation and rising interest rates. The market decided that Mr Trump would be good for the US Dollar and they bought it enthusiastically. However, there was even more enthusiasm for the British Pound once Brexit-fatigue set in. Investors tired of selling Sterling simply on the back of rumour and guesswork. Whether Britain's departure from the EU will be good or bad for the economy remains an open question but, until the structure of that divorce becomes known, it is impossible for investors to make a considered judgment. Between Referendum Eve and the beginning of November the Pound fell by an average of 15.4%, losing 17.6% to the Aussie. In the last month it has recovered nearly a third of that loss as it seems speculative sellers have run out of reasons to carry on. The two worries for the Australian Dollar are interest rates and credit ratings. Former Liberal Party leader John Hewson, who also had a stint as an economist at the Reserve Bank of Australia, maintains that Australia will lose its AAA credit rating. He told Sky News that "The fact that we are going to lose the triple-A credit rating is a foregone conclusion; it's just a question of timing." Higher coal prices are helping but the government's budget has been in deficit since 2008 and Treasurer Scott Morrison does not see the gap being closed until at least 2021. At the same time there is renewed talk of RBA rate cuts. In the coming week the central bank will announce its monetary policy decision 24 hours ahead of the figures for third quarter gross domestic product. Whilst that chronology does not point to an immediate cut, GDP weakness could tilt the RBA towards consideration of the idea in the New Year. Less-than-perfect credit ratings and lower interest rates would be a clear threat to the value of the Australian Dollar.

Another day and another Brexit story. This time, the story was about a new legal challenge that seeks to separate Britain's membership of the EU from its participation in the European Economic Area. It weakened the pound a little. In reality, the pound's fall owed more to profit-taking than to Brexit or any other fundamental economic factor. Sterling has been - and remains - the top performer over the last month, strengthening by an average of 3.8%. With gains of that scale in hand, a decent-sized order to sell sterling - or even the rumour of one - would have been enough to encourage investors to take some profit or at least to pull back their bids.

After a cracking day last Wednesday, which the chancellor's Autumn Statement did nothing to spoil, sterling wallowed through Thanksgiving and floundered on Black Friday. Just as the pound's gains in the middle of last week owed little to the ecostats, neither did its losses at the end. The only UK statistic on Thursday was the narrow BBA mortgage approvals figure, which rose for a second successive month to just shy of 40k. No issues there, then. And Friday's numbers were good, in that they all matched or exceeded forecast. The second stab at third quarter gross domestic product left quarterly growth unchanged at 0.5% with business investment rising by 0.9%; more than expected. Retail sales were strong in November, with the CBI's Distributive Trades Survey indicating a 26% monthly increase. Yet sterling still lost some ground against the Australian dollar. Still relatively strong overall the Australian dollar is benefiting from higher bulk commodity prices, particularly iron ore which is the nation’s largest export item.

Pound much stronger over the past 24 hours. This following uncertainty from the U.S. election on what the potential fallout may be.

A 13% plunge in the value of the Mexican peso and a 5% decline in Japanese equity prices appeared to show investors were not fully prepared for a Donald Trump win. Investors initial reactions included selling equities, selling commodity-related and emerging-market currencies. Nobody knows quite what a Trump presidency will mean for the global economy, let alone for currency and capital markets, but many fear it will have negative implications. The GBP/AUD exchange rate has remained relatively stable for most of the day.

Data just released… In September, British industrial output fell unexpectedly - pulled lower by maintenance at North Sea oil and gas field - manufacturing growth picked up.

Carney and the QIR Fresh from the declaration of his ongoing commitment to Brexit Britain the governor of the Bank of England will today present the bank's quarterly Inflation Report. Mark Carney might also have to justify a lower Bank Rate and increased asset purchases but most analysts think that unlikely. Recent UK economic data have been punchier than feared by some economists following the EU referendum. Whilst the governor did hint at a second rate cut this year investors would be surprised to see one today, given the weakness of sterling. What investors will get, either way, is his spin on the bank's forecasts for growth and inflation. Dr Carney is unlikely to talk up the pound. Two other sterling-sensitive events today are the high court's verdict on the execution of Article 50 and the purchasing managers' index for Britain's services sector. The Article 50 decision will be appealed whichever way it goes.

With a lot of Brexit speculation and talk around the subjet, this has clearly had a negative impact on the pound making it weaker. Last week there was a big drop in the rate. This week, the Aussie home loans data came out negatively however hasn’t affected the Australian dollar too much yet.

Bad day for sterling, rate has dropped dramatically.

Australian Dollar review is below, thanks. Commodity-related currencies in general were helped by softer-than-expected economic data from the United States. The number of jobs created in August was fewer than forecast and a survey of services sector businesses found their activity slowing over the same month. Eight days of gains for the Aussie came to a messy end on Friday 2nd, apparently as a result of an interview that Glenn Stevens, the outgoing Reserve Bank of Australia governor, gave to the Australian Financial Review. His comment that the Australian dollar "could give us trouble" was interpreted as a hint that it was too strong. In common with most emerging market and commodity-related currencies the Aussie was undermined by a suspicion that central banks in Japan and Germany are coming under political pressure to rethink their aggressive quantitative easing activities, which have flooded the world with ultra-cheap money for several years. Australian job stats were inconclusive, insofar as they showed both a loss of jobs in August and a fall in the rate of unemployment. Ecostats from the UK were broadly positive but not sufficiently so to enthuse new buyers of the pound. In the States a fall in retail sales further lessened the likelihood of an interest rate increase by the Federal Reserve in September. In the end the Aussie lost one and a quarter US cents and was down by a cent and three quarters against sterling. After losing out to the NZ dollar for more than a month the Aussie turned a corner and strengthened by 2% in the middle part of the month. It was mainly interest rates that accounted for the move. The Reserve Bank of Australia board minutes seemed to dismiss the possibility of any further interest rate cuts while a statement by the Reserve Bank of New Zealand said "further easing will be required" if the economy needs it. Meanwhile the pound was under pressure from the prospect of its own rate cut and it was taking flak from a step-up in the rhetoric surround Britain's exit from the EU. The chancellor does not believe the country can remain in the single market and talk of a "hard Brexit" worried investors. The Aussie put in one of the best performances against sterling, picking up more than five cents. It also added a little over one US cent. A lack of significant domestic economic data meant the main driver for the Aussie at the end of the month was investors' appetite for risk, which blew hot and cold. Ahead of the first US presidential candidates' debate they were nervous that Donald Trump was in the lead, with all that implies for international relations and trade: after it they were more relaxed. OPEC's surprise announcement of a cap on oil production was vaguely helpful to risk-appetite while grumbling concerns about Deutsche Bank were not.

The UK inflation rate was unchanged from July. The pound was intially strong today but has dropped back against the dollar.

In October, Moneycorp are involved in an event for all nurses looking to move to Australia. More information can be read here - https://www.eventbrite.co.uk/e/nursi...ts-26877293709 If you would like to attend please email me directly - john.kinghorn@moneycorp.com Anyone from the forum who contacts me will not have to pay the entrance ticket fee. Thanks John

The monthly currency review is below. After nearly a week of counting the incumbent prime minister Malcolm Turnbull looked likely to hold onto his job but with only a slender majority. Leaving him less able to drive through the deficit-reduction measures the country needs and because of that Standard & Poor's put Australia's AAA credit rating on negative watch. Eight days after Australia’s general election ended in uncertainty, the prime minister finally claimed victory for his conservative coalition, bringing an end to the country’s political paralysis - at least for the moment. Employment data were helpful to the Aussie, with the addition of 8k jobs in June and a big swing from part-time to full-time working. The attempted coup d'état in Turkey took place just in time for the New York FX market to react to it. Investors' instant reaction was to offload anything commodity-related and stock up with safe-haven US dollars and Japanese yen. The Aussie retreated as a result: down by a cent on the week against sterling and wearing a loss of one and a half US cents. The Aussie received no help whatsoever from a downgrade by the International Monetary Fund of its global growth forecast. Nor did the Reserve Bank of Australia come to the Aussie's aid when it published the minutes of its last board meeting. The final sentence gave every impression that the board has a rate cut at the back of its mind. Success did not come easily to the currency in the latter part of July, with its performance dictated by external factors: the only Australian ecostats were inflation data, in which the Reserve Bank of Australia's "trimmed mean" was unchanged at 1.7%. The external factor in Britain was the purchasing managers' index readings, which showed a slowdown in activity across the private sector and increased the likelihood of an interest rate cut by the Bank of England in August. In the States it was the Federal Reserve, whose monetary policy statement gave no sign of any urgency to increase rates. Investor attention quickly turned to the start of August when the Reserve Bank of Australia was widely expected to reduce interest rates to a record low, after a recent run of weak inflation numbers.

The Australian and NZ dollars were both left in the dust by the Japanese yen but in second and third place they were well ahead of the other major currencies. The Aussie had to settle for bronze, strengthening by nearly two cents against sterling and adding half a US cent. Success did not come easily: the Aussie went onto the retreat on Tuesday and Wednesday before getting back into the saddle on Wednesday. Its performance was dictated by external factors: the only Australian ecostats were Wednesdays inflation data, in which the Reserve Bank of Australia's "trimmed mean" was unchanged at 1.7%. The external factor in Britain was last Friday's purchasing managers' index readings, which showed a slowdown in activity across the private sector and increased the likelihood of an interest rate cut by the Bank of England in August. In the States it was the Federal Reserve, whose monetary policy statement gave no sign of any urgency to increase rates.

IMF sharply downgrades UK's growth forecast The pound was dealt its latest post Brexit blow yesterday when the International Monetary Fund published its world economic update. Having downgraded its forecasts for global growth this year and next by 0.1 percentage points, to 3.1% and 3.4% respectively, the Fund’s biggest revision was – unsurprisingly – applied to the UK economy; cutting the 2016 forecast by 0.2 percentage points to 1.7%, before slashing it dramatically by 0.9 percentage points to 1.3% in 2017. Investors were subsequently compelled to sell the pound against the US dollar as Brexit fuelled economic uncertainty intensified. UK unemployment rate falls to 11-year low The UK unemployment rate has fallen to 4.9%, the lowest since July 2005. The unemployment total fell by 54,000 to 1.65 million in the three months to May, 201,000 less than a year earlier and the lowest level since spring 2008. The number of people in work rose by 176,000, while the employment rate remains at a record high of 74.4%. However, with investors well aware that these positive figures relate to a time prior to the Brexit vote, the pound has gained little strength from their release. Looking ahead Australian business confidence data is released this evening. Tomorrow sees the release of UK retail sales figures, before the European Central Bank President delivers his latest press conference.

Having borne the brunt of the British publics shock decision to sever ties with the EU following the announcement of the referendum result on 24th June, the pound has delivered a stellar performance this week; strengthening by an average of 3.5% against the other dozen most actively-traded currencies. It achieved this after an unexpectedly swift resolution to the leadership campaign on Monday was followed by the Bank of England’s surprise decision to leave its 0.5% Bank Rate unchanged yesterday

The Bank of England has held the UK's main interest rate at 0.5% - as mentioned above there was speculation that rates would be cut.

All eyes on the UK today. There has been some speculation that the Bank of England could make the first cut to UK interest rates in more than seven years today.

More stable day for the pound in that it didn't weaken massively.

Pound continues to drop to new lows The uncertainty generated by the prospect of life outside the European Union, following the historic Leave vote last week, has left sterling lagging a considerable way behind the other dozen most actively-traded currencies. As the dust settled over the weekend we were greeted by Chancellor George Osbourne this morning, who broke his silence on the subject when he told a news conference that the result of the referendum was “not the outcome that I wanted” but that authorities were “ready to deal with the consequences”. Having lost significant ground in the immediate aftermath of Fridays events, the pound came under further pressure today as markets continue to digest the result and anticipate the next steps in the Brexit process.

The UK has voted to leave the European Union after 43 years. Leave won by 52% to 48% - the pound is significantly weaker this morning against all currencies.

Needless to say, it’s going to be an interesting couple of weeks. Exchange rates are likely to fluctuate a lot. Pound slightly stronger this morning as some opinion polls over the weekend showed Remain back in front in the EU Referendum.

Monthly currency review is below – thanks. Doubts about the global economy, stemming from lacklustre economic data from around the world meant investors took flight from the commodity-orientated currencies in favour of the safe-haven euro, Japanese yen and US dollar as May commenced. All the signs were pointing towards a possible interest rate cut Down Under in the near future, yet few investors expected one in May. In the end, however, the strength of the Australian Dollar seen over the last few months, alongside low Australian inflation data finally forced the Reserve Bank of Australia’s (RBA) hand. Consequently, the central bank succumbed to pressure and decided to cut interest rates by 0.25% to a record low 1.75%. The Aussie took an immediate four-cent bath and lost a further ground when the RBA marked down its expectations for inflation. And with further interest rate cuts in the offing, investors remained wary of the Aussie. A mind-set that seemed perfectly reasonable following the release of the consumer inflation expectations figure: the nation reduced its forecast for inflation from 3.6% in April to 3.2% in May. As expectation decreases, so the chance of further dovish action from the RBA increases. The Aussie gained some brief respite when the RBA dampened speculation of an imminent rate cut, before Australian employment data revealed the unemployment rate had steadied at 5.7%. The welcome data came after analysts had been expecting the Australian unemployment rate to increase to 5.8% in April. Despite this, the US dollar had the upper hand courtesy of a string of warnings from US Federal Reserve presidents that rates should go up State side in the next month or two; and the pound was given a leg up to head the field overall by EU referendum opinion polls which suggested the Remain campaign is in the ascendency. The Australian economy was keeping a low profile towards the end of the month and when it did have anything of note to say, it wasn’t positive: construction output and private capital expenditure (investment) both fell by more than expected in the first quarter of 2016. Even so, the Aussie managed to maintain its level against the US dollar. It was a different story in terms of its relationship with the British pound, which was experiencing resurgence thanks to ongoing anti-Brexit sentiment in the UK. A trend in public opinion that was lent further support by the Bank of England governor when he told parliament's Treasury Committee that "a vote to leave the EU could have material [adverse] economic effects". Unsurprisingly, investors interpreted this to mean the central bank is supportive of the Remains argument and, thus, the pound. Mixed ecostats towards the end of May highlighted that, in the current economic climate, investors are more inclined to punish the Aussie for failure than they are to reward it for achievement.

The pound is weaker against the Australian dollar. This was following a Guardian/ICM poll which suggested public opinion has in fact moved towards the UK leaving the EU.

[TABLE=class: cms_table, width: 100%] [TR] [TD]GBP/AUD pair hits 3 month high[/TD] [/TR] [TR] [TD]In his latest address, delivered yesterday evening, Glenn Stevens of the Reserve Bank of Australia spoke of his appetite for a weak Australian dollar, before dropping heavy hints that lower interest rates are around the corner. The Aussie has fallen by more than a cent and a half since his remarks. In terms of its relationship with the pound, Governor Stevens' dovish rhetoric has contributed to the GBP/AUD pair reaching its best levels since February.[/TD] [/TR] [/TABLE]