Swerv-o

I imagine the markets had priced in a rate hike already, and the lack of one has pushed the exchange rate down a little.

I imagine that there will be a rate hike next month though, so it will be interesting to see what happens to the market then...


S

freebo

And the decision not to raise rates was likely caused by weaker inflation data and stronger AUD, if this persists maybe they won't raise rates next month.

hwilson

Not only are we getting a terrible exchange rate, but we are forced to take chances when we transfer:

http://uk.travel.yahoo.com/p-promo-3359938

Not sure what you can do to hedge against it but just make sure you are careful about who you do your money transfers with.

Les Avalook

Unlikely that anyone moving money to Oz would of used this company, they dealt in holiday cash.

Still not nice for Poms though.

paulry

Bets on something closer to 1.80 by the end of the Tory party conference?

Centurion

The markets have already priced in a rate hike before year end. Yesterday even though the holding of rates was against the predictions of economists, it is now back to 97c USD and 0.61 GBP.

Ultimately with more talk in the UK papers of more bank woes and a report of banks needing more public funding in the future, quantitative easing and a growing deficit, not to mention VAT in January, comparatively speaking all is booming in Australia.

Any changes in the fundamentals of the economies will take years to reverse fortunes I suspect.

littda01

Are you out of your mind, have you seen the coverage? Basically the coalition is close to civil war, the LibDems are raging about the 7Bn bank bonuses this yr, and want to tax the snot of of the bankers. Needless to say, the Tories are not too up for that, despite overwhelming public support.

Then there's the cuts, which just get worse with each new announcement. 1/3 of all jobs at all Govt dept HQs to be cut. That is a LOT of people and a LOT of demand removed in the economy which is not going to be replaced by private sector any time soon. Lots of benefit cuts, likewise sapping demand out of the economy.

The markets are not too keen on any of this, I would think. They may like the supposed small-govt aspects of it, but they know a deflationary policy when they see one. Stagnation for the GBP even despite the RBA announcement.

Apologies if your comment was intended as a joke, BTW

asprilla

I love to pull this graph out every now and then. It is updated daily.

http://www.asx.com.au/data/trt/ib_ex...urve_graph.pdf

Haven't actually viewed this one in a long time... so I'm not sure how much it has changed since e.g. yesterday morning, or 3 months ago.

Pretty sure that a while ago, the markets were anticipating a steeper increase. As you can see, current expectations are actually quite low... cash rate to increase 0.5% over the next 18months.

Going slightly off track from exchange rates, lets consider the impact on homeloans in Aus. We all know that the banks love to tell us about how difficult it is for them to raise funds. So we can make an educated guess, based on market expectations, that standard variable rates will be 1% higher in 18months time.... Homeowners will be paying somewhere in the order of 7.5% to 8.5%, depending on how good their current deal is. Having said that, the expectations chart is only a forecast.... it isn't set in stone !

paulry

Everything you've said makes sense. Just trying to make light of a desperate situation an adding a bit of irrational wishful thinking . What a dire and absolute mess we in the UK are in . There'll be no migation honeymoon once we arrive in Australia. It'll be straight to work, any work.

littda01

Good luck with it, didn't mean to be over-depressing

freebo

Thats how it turned out for me, 5 days after landing I started work, and had about 3 days off since (in the last 6 months), still we've now broken even and have even saved up a few dollars, considering converting them to pounds...or maybe not!

You could always look on the bright side, the Australian economy appears to be booming right now, when the high interest rates start hurting the consumer will be interesting, but they're great if you're a saver.

77hil

Same for us when we arrived. No few months to chill and settle in. We had a one week holiday then I was straight at work. Bloody crappy £.

bcworld

...back in the $1.62s...and trying to hit US$0.98.

iamthecreaturefromuranus

Ermmm... I arrived when it was $2.33.

Landed Friday evening in Sydney, started work 9am Monday.

77hil

It's not a competition mate.