Australian Dollar | Latest Australian Dollar Exchange Rate News
Australian dollar recoups losses vs the British Pound, UBS forecast interest rate cut in May
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- Category: Australian Dollar
- Published on Monday, 13 February 2012 10:14
- Written by Will Peters
The pound Australian dollar exchange rate is 0.56% lower at 1.4685, the pound New Zealand dollar exchange rate is 092% lower at 1.8895.
UBS have this morning have warned of an RBA interest rate cut in May - should this view become more widespread we could see some relative easing in Australian dollar strength in the lead up to such an event.
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UBS say:
"Several commercial banks in Australia have raised their lending rates in recent days, and another did so overnight. In
principle, this provides a little more room for the RBA to ease further. The RBA decided to remain on hold last week,
but our Australian economics team expects a 25bp rate cut in May – the final cut in the current easing cycle."
The Australian dollar has recouped Friday’s losses suffered at the hands of the British Pound thanks to strong domestic data and positive international developments.
"The Australian dollar received two good pieces of news over the weekend, the Greek parliament vote gave a boost to risk appetite and Australian home loans data provided an upside surprise. The home loans figure explains why the RBA was not hasty in cut interest rates again last week," says Richard Driver, foreign exchange analyst at Caxton Fx.
Driver note that there have been some recent comments from an RBA policymaker expressing dissatisfaction with elevated australian dollar levels, which suggests its rally may be nearing its end.
It should have a good session today though; sterling currently trades at 1.47.
Sterling is back down at six-month lows against the New Zealand dollar, helped by gains in Asian stocks.
The markets have responded with an upbeat tone to the weekend’s Greek developments. There was some disappointing news from Japan in the form of a worse than expected -0.6% quarterly growth figure, no doubt caused in part by the damage being done to Japanese exporters by the strong yen.
Nonetheless, the New Zealand dollar is back on the front foot and with equities advancing the GBP/NZD pair had dipped below 1.89 this morning. Further losses are possible warn Caxton.
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