Aussie Dollar Climbs to Highest Ever Against UK Pound, May Climb Higher

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Peter Lavelle

Hello, and welcome to my latest update of the Australian dollar/UK pound exchange rate.

The Aussie goes where it’s never gone before!

 The Australian dollar hit its highest ever point against the UK pound this week, at 0.6953.

This means the Aussie dollar has never been stronger against sterling, since it was floated in 1983.

 By comparison, the exchange rate was at 0.6358 on 1st January this year. It’s therefore climbed +9.36%, or almost 6 pence.

 To put that into context, a $250,000 transfer would be worth £14,875 more today than the start of this year.

 (Please bear in mind, these are the interbank rates at the time of writing, meaning the exchange rate may have changed since then.)

Australian Dollar May Keep Rising Against the Pound

pound sterlings

Furthermore, looking ahead, the exchange rate may keep rising. This is because:

  1. Output in UK factories declined -1.5% in February, the 3rd consecutive fall.

    This may put pressure on the pound, because it increases the chances of a triple-dip recession.

  2. To boost the UK economy, the Bank of England could restart its printing press in April.

    That may bring sterling down, because it means printing money, which devalues the currency.

  3.  Australia created 71,500 jobs in February, the fastest rate since July 2000.

    That may lift the Aussie, because it bodes really well for Australia's future growth.

  4. The Reserve Bank of Australia is now less likely to cut interest rates below 3.0%.

    That could boost the Aussie, because higher interest rates make the currency more profitable to buy.

Given that, watch for the Australian dollar to keep climbing soon!

About the Writer

Peter is the chief economist at Pure FX. He's worked in foreign exchange since 2010, and is a close follower of global politics and economics. If you have any questions for him about exchanging Australian dollars, get in touch with the form below. He'd be delighted to help answer them.

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