Aussie Dollar exchange rate July 7
07 July 2016 by News DeskThe Pound tumbled to new multi-year lows according to today’s update from UK-based currency specialists TorFX
Australian Dollar – The Pound to Australian Dollar exchange rate suffered a 275-pip plunge. It was a mixture of Brexit related UK concerns and the dovish Fed outlook that drove GBP/AUD lower.
New Zealand Dollar – Sterling weakened by around 150 pips against the New Zealand Dollar yesterday, striking a new three-year low as the prospect of low interest rates for longer in the US increased the appeal of the high-yielding ‘Kiwi’ Dollar.
Sterling – The Pound tumbled to new multi-year lows yesterday as more commercial property funds were forced to suspend trading following a surge of post-Brexit withdrawal requests.
Six major property funds have now frozen trading, meaning that more than half of the UK’s £25 billion property investment sector is now on ice. Analysts expect the other major players to follow suit shorty. It is anticipated that firms will not reverse the decision swiftly because they will need to go through the lengthy process of selling property in order to raise the cash needed to pay back investors.
Sterling has suffered a severe loss of confidence in reaction to the fund freezes because 75% of small businesses use commercial property as collateral for loans. The fear is that property prices will slide as funds sell, which in turn will reduce the ability of businesses to expand and could contribute to a recessionary spiral.
Euro – The Pound to Euro exchange rate approached a near-three-year low yesterday, shedding 100 pips as the property investment sector stoked fears of further economic turmoil.
Sterling has now lost 15 cents to the single currency since the referendum results were announced, which has had the subsequent effect of knocking Britain below France in the global GDP rankings. France overtook the UK to become the world’s fifth biggest economy as the lower exchange rate brought UK GDP down to €2.172 trillion, less than France’s €2.182 trillion.
Dollar exchange rate
US Dollar exchange rate – Sterling struck another new 31-year low against the US Dollar yesterday as Brexit fallout continued to weigh heavily on the Pound in the currency markets.
Data from across the pond showed that US service sector output rose from 51.3 to 51.4 in June. New business spending hit a five-month high but business expectations softened and hiring slowed to a 17-month low. Analysts were looking for a rebound in the second quarter, following the soft annualised Q1 score of 1.1%, but the final PMI surveys point to softer economic growth in the region of 1.0%.
The minutes of the latest Federal Reserve policy meeting suggested that the US central bank is likely to hold off on rate hikes for the foreseeable future, in order to give policymakers time to evaluate ‘additional data on the consequences of the UK Brexit vote.
Canadian Dollar exchange rate – The Pound to Canadian Dollar exchange rate struck a new two-and-a-half-year low yesterday as ultra-low UK government yields, Bank of England stimulus expectations, ‘Brexit’ uncertainty and a slew of property fund freezes pushed the Pound to the bottom of investors’ wish lists. The risk-sensitive ‘Loonie’ gained more ground during the evening in response to the news that monetary policy would remain loose south of the border in the US.
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