The 2021 AUD to GBP Forecasts from Australia's Biggest Banks
In 2021, banks generally forecast the AUD to GBP exchange rate to rise.
Most banks expect up to a 5% recovery in global growth in 2021, after a contraction of about 4% this year. The Australian dollar is expected to benefit more than the Pound Sterling.
This is because the GBP exchange rate has been on a roller coaster ride ever since "Brexit" was voted for and announced in June 2016.
How coronavirus affects global exchange rates
Uncertainty from the coronavirus pandemic increases volatility in currency markets including the EUR and GBP. Generally, safe-haven currencies like the USD, CHF, and JPY could move higher. However, commodity currencies such as the AUD, NZD, CAD and ZAR exchange rates could fall.
This could mean that confidence may be returning for the global economic outlook. However, a faltering recovery from the ongoing threat of coronavirus could continue to create sharp moves in currency crosses like the Australian Dollar to the Pound Sterling exchange rate.
The rising possibility of a vaccine for the coronavirus in 2021 should be supportive for most currencies.
AUD to GBP Mid-Year 2021 Forecast Summary
- ANZ predicts the AUDGBP exchange rate will be 0.5263 by June 2021
- NAB's AUDGBP forecast shows the exchange rate to be 0.5600 by the middle of 2021
- Westpac predicts the AUDGBP rate to be 0.5606 in June next year
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GBP to AUD Bank Forecast
To convert from GBP to AUD all you need to do is divide 1 by the rate.
For example, if the AUD to GBP exchange rate is 0.55, then 1 Australian dollar is worth £0.55 Pence. You divide 1 by 0.55 to find the GBP AUD exchange rate of 1.8181. In this example, £1.00 Pound Sterling is equivalent to $1.8181 Australian dollars.
The "Big 4" bank GBPAUD forecasts in the table below:
Bank GBPAUD exchange rate forecast
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Where to find the best AUDGBP cash rate
In Australia, the best cash rates are found in major cities. We regularly check the main money changers in each CBD to find out the best exchange rates in town.
How to track down the best cash rate
You can either walk around to each money changer, try and call each one and check their rate or you can use our city and suburb guides:
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What is the AUDGBP?
The AUDGBP pair tells you how many British pounds are needed to purchase one Australian dollar.
The British Pound is also known as the 'British Pound Sterling'. The pound ranks number 4 behind the US dollar, the Euro, and the Japanese Yen, for the worlds most traded currency.
Does the AUDEUR exchange rate change a lot?
Like most currencies, the Australian dollar exchange rate and the EUR exchange rate can be highly volatile.
AUD/GBP forecasts can also change drastically, in response to significant currency moves. Many exchange companies or money transfer services offer rate alerts online to help you get the best AUDGBP cross rate.
Is the AUDGBP rising?
The Aussie dollar is relatively stronger than the GBP, which makes the rate go higher. There are many factors that influence this relationship, but here are some of the main ones:
- Coronavirus: Uncertainty from the coronavirus pandemic increases volatility in currency markets including the AUD and GBP.
- Australian dollar currency (USD): When the AUD rises, the GBP falls. This is because the AUDGBP is a currency pair. The Australian dollar is on a rising trend compared to the British Pound, which is staying low.
- Weak UK economy: The UK has crashed into into deepest recession of any major economy according to the news. UK economic output slumped by 20.4% in the second quarter of 2020, the worst levels since quarterly records began in 1955. What does this mean? A weaker GBP exchange rate relative to the Australian dollar will make the AUDGBP rate rise.
- Brexit: The UK is in a period of uncertainty while Brexit is being finalised. This year it has been delayed due to coronavirus, but the UK is hopeful of a deal sooner rather than later. A Brexit deal is important for trade, with EU being the UK largest trading partner. The more this drags on, the greater uncertainty and the weaker the pound.
- US-China trade war: US President Donald Trump still has tariffs on Chinese imports. In January both countries agreed to ease restrictions imposed on imported goods from each another. However, relations have become increasingly strained in the last six months over a wide range of issues. If China's economy gets negatively impacted, demand for goods from the UK and Australia could also slump. Both the AUD and GBP falls as a result.
How are AUD GBP forecasts usually made?
Investors forecast the movement of the Australian dollar as it relates to the British Pound, by looking at key influences including:
- Currencies - Australian dollar forecasts, GBP forecasts, and US dollar forecasts
- Central banks - namely the Reserve Bank of Australia (RBA) and Governor Philip Lowe, and US Federal Reserve (the Fed or FRB) and Chairman Jerome Powell, Bank of England (BOE) and Governor Mark Joseph Carney
- Interest rates - linked with central banks that control interest rates and monetary policy. Investors predict how central bank announcements - like interest rate cuts or hikes - will affect interest rate spreads.
- Local governments - Australian Government and Prime Minister Scott Morrisson, US Government and President Trump, UK's Brexit and Prime Minister Boris Johnson
Australian Economic Data - Economic growth indicators (GDP), Inflation (CPI Core Price Index, PPI Production Price Index), Trade balance (balance between exports and imports of total goods and services)
- UK Economic Data - GDP, trade balance and inflation
- US Economic Data - GDP, trade balance and inflation
- China (plus Hong Kong, Singapore, and rest of Asia) Economic Data - GDP, trade balance and inflation
- Commodity Prices - raw materials like iron ore for Australia and processed goods like cars and petroleum products are a big exports for the UK
Should I trust bank AUDGBP forecasts?
The Australian Dollar and British Pound exchange rates can change a lot. So while banks have experts that spend long hours modelling future currency moves, there may be factors that aren't predicted.
Multiple factors influence currency movements that are both local and global. Plus, major bank forecasts are generated with a combination of computer modelling and human influence.
We think it's better to look at exchange rate forecasts as a guide. We also recommend you don't make your financial decisions based solely on bank forecasts, but rather, take into account your personal objectives, financial situation and needs.
Where can I find out more about AUDGBP?
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