Best Australian Dollar Exchange Rates – The Surge

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Since the banking crisis in 2008 Australia has actually had a pretty strong economy and growth that would have George Osborne on cloud nine, at typically 3% or more for the past four years the Australian Dollar has been stable with fluctuations of plus or minus one or two percent.

Currency graph Britsh Pounds vs Australian Dollar

You can see how the amount of Dollars you can buy has fallen since the banking crisis on 2008

For us in the UK Australia is still expensive to visit and the exchange rate is not doing us any favours. What happened was as the UK, Europe and US all suffered the credit crunch and our currencies lost value (relative to the Australian Dollar) the Aussie Dollar jumped up by 21% in just a few months. Since then our economy, the Eurozone and America have been stagnating leaving the Aussie Dollar expensive but stable.

That was the ‘Surge’ referred to in the title and it was not a good thing for us or for Australian businesses trying to sell goods overseas.

That was then, what about the future for the Australian Dollar?

In April 2012 the National Australia Bank cut their growth forecast from 3.2% to 2.9%. In May JP Morgan cut their growth forecast to 2.7% and in August Deutsche Bank issued a recession warning for Australia by the end of 2013. Now bankers are not infallible (there’s an understatement) and they have been known to be wrong in the past but it is certainly possible that these forecasts may start to bring the Australian Dollar exchange rates back down to something more affordable over the coming 12 months and beyond. Then again it could be that the future holds even worse news the the UK and Europe and any changes is cancelled out.

So ignoring the doom mongering it looks as if we may start to see some more competitive exchange rates soon for the Australian Dollar.

What does this mean for you?

I cannot give financial advice and I am not a banker. If you have a few thousand pounds worth of Australian Dollars you were holding on to because you wanted to go back to Australia you probably should have changed them back to Pounds when you returned. Holding them as Dollars had seen inflation eat into their value. It is impossible to say whether the Dollar with drop just slightly to significantly if the banks forecasts prove true as currencies move relative to each other and the other major currency in the Pacific is the Chinese Yuan and their growth is also being revised downwards. The best thing to do is to buy or sell your currency when you see an offer price you are happy with.

Posted by Peter Rudin-Burgess

Peter Rudin-Burgess

Peter is one of the founding partners for both Compare Holiday Money and Currency Buy Back. He regularly blogs on financial matters and writes content for a number of blogs in the travel industry.

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