Australian Dollar Exchange Rate Today - AUD Advances vs Pound Sterling (GBP), Euro (EUR) & US Dollar (USD)

Modified: Wednesday, 25 June 2014 19:56 BST - Written by James Fuller

STORY LINK Australian Dollar Exchange Rate Today - AUD Advances vs Pound Sterling (GBP), Euro (EUR) & US Dollar (USD)

The Australian Dollar exchange rate and other commodity currencies surged against the pound sterling, euro and US dollar on Monday after the AUD found support from the release of better than forecast Chinese manufacturing data.

The positive Chinese data boosted the ‘Aussie’ as China is Australia’s biggest trading partner and also raised speculation that the Reserve Bank of Australia may have to resort to attempting to talk the currency as it remains stubbornly high despite investor expectations that it would begin to drop over the coming months. The pound to australian dollar exchange rate is 0.08 per cent lower today at 1.81158 GBP/AUD.

The Australian currency has seen modest gains on Wednesday morning, such as the australian dollar to euro exchange rate is +0.05 per cent higher at 0.68868 and the australian dollar to pound exchange rate is +0.08 per cent higher at 0.55201.

Against the US currency the ‘Aussie’ surged back above the 94 cents level, its highest level for two and a half months. The data showed that the HSBC/Markit Flash China Manufacturing Purchasing Managers Index climbed to 50.8 this month, up from the previous month’s final reading of 49.4.

''It's over the 50 threshold for the first time this year which is a slight indication that some of the data is turning the corner,'' said HSBC's head of Asian currency research, Paul Mackel.
The increase increased investor optimism that the world’s second largest economy is shrugging off a slowdown as the Chinese government’s stimulus policies take effect.

The Pound Sterling to Australian Dollar exchange rate is 0.37pct down on the day at 1.80644 GBP/AUD - 25/06/2014 20:00 GMT

“Today’s data out of China eased concerns about falling commodity demand, helping to boost currencies such as the ‘Aussie’. As volatility remains low among the major currencies, higher-yielding currencies like the ‘Aussie’ and ‘Kiwi’ tend to be bid,” said a senior analyst at Money Square Japan Inc.

The ‘Aussie’s’ surge above 94 cents is likely to see the RBA try and talk down the currency at its next policy meeting as the high value is likely to be having a negative impact upon the nation’s exporters as well as harming tourism.

As such many economists still believe that the currency will have to show signs of a drop over the rest of the year.

“It’s not so much that we have a negative view on the Australian economy or anything like that. We believe that come the second half of this year that the US Dollar positive story will get more traction than has been the case in the past few months. As that becomes more likely the US Dollar will be returning hard against a lot of currencies, particularly the European currencies and a number of G10 currencies,” said MR Mackel.

US Dollar forecast - USD may impact AUD

The US Dollar could take some of the wind out of the Australian Dollar’s sails later in today’s session if the latest Markit Manufacturing PMI and existing home sales data comes in strongly. So far this year economist expectations for a strong revival in the US economy have been thwarted as data releases in recent weeks have widely disappointed and only hinted at a recovery.

The ‘Aussie’ has also been benefitting somewhat from a safe haven perspective as investors favour the currency despite the conflict in Iraq which would typically soften demand for the currency and bolster demand for currencies such as the Japanese Yen and Swiss Franc.

The situation in the Middle Eastern nation deteriorated further over the weekend after militants captured key crossings on the Syrian and Jordan border.

The strategically important airport at Tal Afar also fell and several more towns were taken. Of the Iraqi army they appear to be having little effect against the militants. Over the past two days they have taken four strategically important towns in the predominantly Sunni Anbar province - Qaim, Rutba, Rawa and Anah.

US Secretary of State John Kerry, speaking in Cairo on Sunday, urged Iraq's leaders "to rise above sectarian motivations and form a government that is united in its determination to meet the needs and speak to the demands of all of their people".

Pound to Australian Dollar Update 24/06/2014

The Pound Sterling reversed some of yesterday’s losses as concerns over the crisis in Iraq and worries that the European Central Bank will leave interest rates low for longer than expected sent investors to safe haven assets.

With a lack of domestic data out of both nations trade is likely to be quiet and dominated by events elsewhere.

Fears over Iraq increased as Sunni militants continued their offensive. The Islamists have taken control over the nation’s largest oil refinery and are edging closer to Baghdad.

Wednesday's forecast also promises to be a quiet session as again no market moving data for either currency is due to be published.

Australian Dollar (AUD) Exchange Rates - 25th June 2014

The Pound to Australian Dollar exchange rate is trading down -0.37% at 1.80644 GBP/AUD.
The Pound to Euro exchange rate is trading down -0.21% at 1.24537 GBP/EUR.
The US Dollar to Australian Dollar exchange rate is trading down -0.37% at 1.06376 USD/AUD.

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