It’s Tuesday, the birds are singing, the Trade War is once again sprouting good news and, best of all, it’s Click Frenzy time!! If you’re in the market for some foreign currency, now’s the time to jump on our Click Frenzy rates before it ends at midnight on Friday. The currency Gods are shining on this frenzy and have provided the Aussie Dollar with a slight boost after the depressing lows of last week. As it stands, one AUD will buy you:
0.6639 US dollars
69.8489 Japanese yen
0.5409 Great British pound
0.8578 Canadian dollars
1.0283 New Zealand dollars
0.8963 Singapore dollars
If you purchased $2000AUD worth of the above currencies today, you would be getting a bonus compared to this time last Friday.
USD - Extra $10
JPY - Extra 2,203.40 yen
EUR - Extra 17.40 euros
GBP - Extra 4 pounds
CAD - Extra $19.4NZD - Extra $29.60
SGD - Extra $18.60
See, I told you - bonza rates! Avoid missing out on these rates and safeguard yourself for any future rate rises by adding Rate Guard to your purchase in-store. It’s free, and if the rate improves within 14 days of purchase, we will refund you the difference*.
Frenzy aside, let’s check out what else is impacting foreign exchange markets this lovely Tuesday morning.
Better global prospects stemming from Trade War, Germany and Chinese Interest Rates
On Monday, Asian, European and US stocks saw a significant increase in line with an improved global outlook. This increase resulted from three key things:
- China announced interest rate reforms that would allow for cheaper borrowing for both households and business.
- Germany said they could inject $US55billion into their economy to combat a recession.
- Chair of the US Federal Reserve, Jerome Powell, is expected to signal more cuts to interest rates in a speech he is set to deliver later this week.
China, Germany and the US are three of the world’s major economies, so improvement for them is a good sign for the global economy. The culmination of these elements has lead to improved market sentiment and investor confidence.
On the US/China trade war front, Trump tweeted that “We are doing very well with China, and talking!”. This tweet has once again fostered new hope regarding a resolution to the trade war. We have been here before though, and conditions (and Trump’s mood) have soured just a quickly as they have improved, so we are by no means in the clear yet.
US commerce secretary, Wilbur Ross, has delayed the ban on US companies doing business with China’s Huawei for another 90 days to give US business’ a chance to adjust. Despite this delay, the US is still set to impose a 10% tax on another $US300billion worth of Chinese imports into the US on September 1.
As if there wasn’t already enough impacting US/China trade talk progress, the current protests in Hong Kong have thrown another spanner into the works. Trump has mentioned that any proposed deal would be forgotten should the Chinese government turn to violence as a means of quelling the Hong Kong protests.
This news comes just as Twitter and Facebook have exposed the Chinese government running a covert propaganda campaign on social media to undermine the Hong Kong protests. Protestors enter their 11th week of relatively peaceful demonstrations over Human Rights concerns, and fears of a new bill that would allow Hong Kong residents to be deported to China.
In other, less savoury news, a recent survey has shown that over 70% of economists expect a recession in the US before the end of 2021. This number increased from 67% in February and comes after two bond yield inversions in the last six months - a move that has predicted the previous seven recessions.
Not one to be concerned by consensus, Trump disagrees and said “I really don’t think we’re having a recession. We’re doing tremendously well.” I’ll let you decide whether to trust Trump or the economists more, either way, the global economic signals we have been seeing this year certainly aren’t filling us with hope.
This week, new information has come out saying that, should the UK leave the EU without a deal on October 31, EU citizens will not lose the right to live and work in the UK immediately. Despite new Home Secretary Priti Patel wanting to end free movement immediately, there is not enough time to completely replace current immigration rules.
This is the first real information we have received about post-Brexit Britain. With this in mind, we still don’t know if the UK will leave the EU on October 31 with a no-deal, or if the deadline is to be extended again.
In hopes of honouring the October 31 deadline, Boris Johnson has delivered a letter to the European council president, Donald Tusk, asking to replace the current Irish backstop with a “legally binding commitment” for both the UK and EU to avoid building infrastructure and carrying out border checks. Tusk has yet to accept this offer; however, Johnson is set to travel to Germany and France to emphasise his determination for Brexit to take place on October 31, regardless of whether there is a deal or not.
This comes after a “leaked” government document reveals that crashing out of the EU with a no-deal would lead to food, medicine and fuel shortages as well as job losses and port disruptions. Eeep.
All things considered, it is expected that a group of cross-party benchers will use the House of Commons session on September 9 to legislate against a no-deal Brexit by requesting another extension to the deadline.
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