Hi all,

The Australian Dollar today is still one of the strongest currencies of the day even after weak chinese numbers and expected to be quiet until we hear more from the ECB and the FOMC meetings next month. 

Whilst this is the greatest news for those needing to sell australian dollars it is great news for exporters. We are however looking for the pounds to australian dollar exchange rate to head back into the 1.5500 area over the coming weeks as the euro crisis carries over another month.

Pounds to Australian Dollars = 1.4900

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IMS Foreign Exchange
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Australian Dollar Outlook steady for 2011

THE Australian dollar has ended lower as investors dumped risk assets following a slump on Asian equity markets.

At 5pm australian dollar exchange rate was trading at 98.79 US cents, down from Friday's close of 99.00 cents. Shortly after, the local unit traded between 98.65 US cents and 98.90 cents. UBS interest rate strategist Matthew Johnson said the australian currency moved sideways during domestic trade. "The australian currency is trading in such a small range due to low levels of liquidity," Mr Johnson said.

He said there had been a slight move towards safe haven assets due to increased tensions on the Korean peninsula and falls in equities. The Australian share market finished the day weaker after sagging bank stocks outweighed gains to the energy sector.

The Australian bond market ended firmer after investors moving into safe haven assets as military tensions on the Korean peninsula increased.

The Australian dollar closed at 82.86 yen, down from 83.18 on Friday and at 75.07 euro cents from 74.56 previously. At 4.30pm AEDT on the ASX 24, the March 10-year bond futures contract was at 94.430 (implying a yield of 5.570 per cent), up from Friday's close of 94.365 (5.635 per cent). The March three-year bond futures contract was at 94.730 (5.270 per cent), up from 95.700 (4.300 per cent).

Mr Johnson said Australian bonds were relatively flat after a rally in US Treasuries. "Weaker equities have caused US Treasuries to rally and Australian bonds have followed suit," Mr Johnson said.

"The ten years have been stronger than the three years, given the offshore factors. There's a little more tension on the Korean peninsula, so there's been a move away from risk on the equity market."

Mr Johnson said bonds would continue to trade in a narrow range in the lead-up to Christmas. "At this time of the year you'd expect the thin trading volumes."

The 90-day bank bill closed at 4.980 per cent down from 5.020, while the 180-day bank bill closed at 5.170, down from 5.210.

At 4pm AEDT, the RBA's trade weighted index was unchanged from Friday's close of 74.8.

Read more: www.news.com.au

Pounds to Australian Dollars = 1.5700
Euros To Australian Dollars = 1.3300
Australian Dollars to US Dollars = 1.0000
Australian Dollars to New Zealand Dollars = 1.3300

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Overseas Money Transfers

Best Australian Mortgage Deals

Australian Interest rates will stay steady for at least another two months after the
Reserve Bank today kept the official rate on hold at 4.75 per cent. The decision
was widely expected after the RBA’s surprise move last month prompted the big
banks to lift mortgage rates well beyond the official 25 basis-point rise. HSBC
economist Paul Bloxham said last week that today’s decision was “almost a fait
accompli” after mortgage rates rose by about 40 basis-points in November, “which
is plenty of tightening for now”. After today’s board meeting, the RBA will not
meet again until February,

the Herald Sun reports.
In a statement detailing today's rate decision, RBA governor Glenn Stevens said there continued to be "a degree of caution" in consumer spending and borrowing, which has led to "a noticeable increase" in the household saving rate. "Following the board's decision last month to lift the cash rate, and the subsequent increases by financial institutions, lending rates in the economy are now a little above average," Mr Stevens said. "The board views this setting of monetary policy as appropriate for the economic outlook."

A 25 basis point increase to the official rate would have added about $50 a month to a $300,000, 25-year home loan, according to research company Canstar Cannex. All 15 economists surveyed earlier by AAP forecasted the central bank would leave the overnight cash rate at 4.75 per cent. The meeting followed weak economic data last week showing the Australian economy grew 0.2 per cent in the September quarter for an annual pace of 2.7 per cent and retail trade fell 1.1
per cent in October. "The 'super-sizing' by the commercial banks all but liminated the need to do much more near term," JP Morgan chief economist Stephen Walters said yesterday. Last week's data also showed tepid economic growth in the September quarter and an unexpectedly weak result for October retail sales, giving the (RBA) more flexibility on its next move. The jump in
mortgage rates, aside from the uproar from customers and politicians of all stripes, has caused a change of behaviour among borrowers.

According to Mortgage Choice data, almost 11 per cent of all home loans approved in November were fixed rate, compared with 7.7 per cent in October, as borrowers sought certainty in their
monthly repayments. Such mortgages accounted for less than one per cent of approvals in January. Another broker, Loan Market, has also faced a flood of inquiries from people wanting to reduce their home loan by moving to a smaller house. Treasurer Wayne Swan is expected to announce a suite of measures this week to encourage more banking competition by promoting smaller banks, building societies and credit unions.

For the full story please visit www.news.com.au

Pounds to Australian Dollars = 1.5850
Euros To Australian Dollars = 1.3450
Australian Dollars to US Dollars = 1.0095
Australian Dollars to New Zealand Dollars = 1.3000

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IMS Foreign Exchange
Buying Australian Dollars? Buy Australian Dollars at the Best Australian Dollar Rates!

Buy Travel Money Australian Dollars?

Contact IMS Foreign Exchange + 44 207 183 2790

Overseas Money Transfers

Pounds To Australian Dollars: Pounds To Australian Dollars today

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Pounds To Australian Dollars today

THE Australian dollar has reached another post-float 28-year high against the US dollar.

The dollar exchange rate reached its record high of 100.57 US cents in early trade today, another post-float 28-year high.

Australia's push above parity with the US dollar rate will have a mixed impact on the economy, Prime Minister Julia Gillard said.

"This is a mixed thing. It's good for some industries and bad for others,'' Ms Gillard said on the Nine Network.

"If you rely on imported components to do what you do, then it makes a good difference. But if you're competing for things like tourism, international education, it makes it really tough."

Buy US dollar slid overnight, briefly touching a nine-month low against the best euro exchange rate, after the Federal Reserve said it would spend US$601 billion to buy US government bonds in an effort to boost the economy.

Investors had expected the Fed's action for months, since Ben Bernanke, the central bank's head, hinted at the move in a speech in late August.

To Read more please visit www.news.com.au

Pounds to Australian Dollars = 1.6000
Euros To Australian Dollars = 1.4085
Australian Dollars to US Dollars = 1.0095
Australian Dollars to New Zealand Dollars = 1.2751

Bye For Now

IMS Foreign Exchange
Buying Australian Dollars? Buy Australian Dollars at the Best Australian Dollar Rates!

Buy Travel Money Australian Dollars?

Contact IMS Foreign Exchange + 44 207 183 2790

Australian Dollar Outlook

THE Australian dollar exchange rate is expected to stay above 90 US cents throughout 2011 as the Reserve Bank continues to raise interest rates.

Australia's resource sector is also tipped to prop up the domestic economy, replacing stimulus spending as a key driver of growth.

The "high-flying" Australian dollar should stay well supported for a while longer, Access Economics said in its latest Business Outlook report.

The forecaster's director Chris Richardson said he envisaged the Australian dollar rate staying above 90 US cents throughout 2011, but not going much beyond parity.

"We face roughly a year with the dollar being strong," he told AAP.

The Reserve Bank is also tipped to keep raising interest rates next year as wage costs put pressure on inflation.

"Australia's economy continues to dance to the beat of a different drum, and continuing good economic news and the coming inflection in inflation are likely to see the Reserve Bank raising rates again," the report said.

The cash rate was tipped to climb from 4.5 per cent at present to 6 per cent by the end of 2011, with the central bank tipped to raise the cash rate at least once before Christmas.

The report said business investment in the resources sector would be "absolutely vital" to Australia's economic recovery, replacing public stimulus spending as a growth driver.

"We need to see the likes of the Gorgon project and other resource spending take the baton of growth from the construction of school halls," it said.

This would offset sluggishness in the retail and housing construction sectors, the report said.

By the end of next year, Australia's terms of trade was expected to fall as a greater global supply of resources caused commodity prices to "return to earth".

The central banks of other advanced nations, including the US, would also start to lift interest rates.

This would diminish Australia's interest rate differential with other advanced economies and see the local currency fall off its highs, Mr Richardson said.

When it came to politics, Access Economics had misgivings about a minority government offering "a bucket of bribes" to the regions and promoting populist economic policies.

"They're not going to risk political capital going for the right thing," Mr Richardson said.

He cited shadow treasurer Joe Hockey's call to regulate bank interest rates as an example of irresponsible politics, and urged the government to refrain from erecting new trade barriers, subsidising old industries and reaching for regulation without checking if its costs outweighed benefits.

"And don't chase the chimera of 'supporting jobs' in an economy that is already close to full employment," Access said.

Access Economics is expecting consumer price index data for the September quarter to show an annual growth of 2.9 per cent and a quarterly pace of 0.75 per cent, when the figures are released tomorrow.

To Read more please visit

www.news.com.au

Pounds to Australian Dollars = 1.5789
Euros To Australian Dollars = 1.4185
Australian Dollars to US Dollars = 0.9920
Australian Dollars to New Zealand Dollars = 1.3152

Bye For Now

IMS Foreign Exchange
Buying Australian Dollars? Buy Australian Dollars at the Best Australian Dollar Rates!

Buy Travel Money Australian Dollars?

Contact IMS Foreign Exchange + 44 207 183 2790

Australian dollar's impact on company profits

THE Australian dollar's impact on company profits should be a mixed bag this reporting season.

On one hand, a more than US Dollar 8c decline against the greenback after the dollar punched above US94c in November would have come as a welcome relief to businesses with big US exposures, The Australian reported.

"If anything, that is going to provide a modest boost to earnings," said UBS chief strategist David Cassidy.

But its stellar march forward against the euro is likely to have dented the profitability of companies with operations in Europe. "For companies with big euro rate exposure, that is going to be a pretty clear headwind," Mr Cassidy said.

Last financial year was a roller-coaster 12 months for the Aussie Dollar. After breaking through US94c in November, it was sold down heavily in May to a low of US80.65c, as concerns over Europe's debt crisis intensified.

Fat Prophets analyst Colin Whitehead said the dip would have benefited exporters such as Foster's, which would have been able to compete more effectively on price. "Then you have the broader macro effect of tourism - during periods of Australian dollar weakness the tourism industry will benefit from more overseas visitors."

By the end of the financial year, the Australian dollar Rate had recovered more than 6 per cent to end the year at US85.53c, limiting its effect on local groups with US operations.

RBS equities strategist Greg Goodsell said he would be surprised if the dollar, against the greenback, was a big factor this reporting season.

"In the last 12 months it has averaged between US78c and US92c, so it has been in a reasonable range, whereas during the GFC it went down to the low 60s," he said.

He said Australian stocks generally did not take naked currency risk any more. "Most of them manage their exposures pretty well - they either put financial hedges in place if they have a significant degree of risk or do natural hedging, so if they have US dollar assets they will typically fund themselves in US dollars," Mr Goodsell said.

"Because of that, the currency has to move a long way to have a big impact on earnings results."

But Mr Cassidy said there could be some euro-related downgrades to watch for due to the dollar's strength against the euro exchange rate.

Last financial year, the dollar surged about 20 per cent against the euro, reflecting the differing outlooks for the Australian and euro-zone economies. "Obviously there are lots of moving parts as to how the business is actually going operationally, but companies like Amcor and Brambles do have big European operations," Mr Cassidy said.

To Read more please visit

www.news.com.au

Pounds to Australian Dollars = 1.7575
Euros To Australian Dollars = 1.4903
Australian Dollars to US Dollars = 0.8697
Australian Dollars to New Zealand Dollars = 1.1599

Bye For Now

IMS Foreign Exchange
Buying Australian Dollars? Buy Australian Dollars at the Best Australian Dollar Rates!

Buy Travel Money Australian Dollars?

Contact IMS Foreign Exchange + 44 207 183 2790