GBP/AUD forecast – political turmoil hurting the Australian Dollar

AUD exchange rates have fallen in recent days following political infighting. This turmoil has lead to Scott Morrison being sworn in as Australia’s next Prime Minister. This brings to end a bitter feud within the Australian government, creating a fall in value for the Australian currency.

Mr Turnbull had been under pressure from his own colleagues and is now the fourth Australian PM in a decade to be ousted by his own party. Mr Turnbull had been under internal pressure with Mr Morrison winning an internal ballot 45-40 over former Home Affairs Minister Peter Dutton – who had been Mr Turnbull’s most vocal opponent.

Political instability can often cause a currency to devalue and makes the currency vulnerable to some significant market volatility. We have now seen the pound rally nearly 2% since the lows of mid-August with rates back close to 1.76. However the news of Mr Morrison’s appointment may lead to some stability for the AUD meaning those looking to buy the currency may have a limited window to take advantage of its recent fall in value.

Do you need to buy Australian Dollars?

If you need to move money to Australia this recent fall in value could be an opportunity to secure some of the better levels we have seen in recent weeks. Rates earlier this month were as low as 1.72 but peaked yesterday at 1.77. On a £200k money transfer this makes a difference of 10k AUD – a significant difference.

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