Aussie Dollar Update

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Aussie Dollar Update
Topic Started: Jul 11 2006, 08:15 AM (159 Views)
HIFX plc	Jul 11 2006, 08:15 AM Post #1
Redback Posts: 9 Group: Members Member #3 Joined: June 30, 2006	Interest Rates remain at 5.75% The Reserve Bank of Australia kept interest rates at 5.75% at the July meeting, following the rise by 0.25% in May when the Reserve Bank cited increased inflationary pressures could flow through to consumer prices. The increase in May was the first for 14 months to a level which is the highest in five years, but a combination of low unemployment, rising wages and record fuel prices may stoke inflation further this year with some commentators suggesting another increase in interest rates before the end of the year. For a UK migrant heading to Australia, increased inflation will mean that the cost of living increases as goods and services get more expensive. A comparison of goods and services between the UK and Australia however still shows that prices in Australia will still be cheaper than a UK migrant might be used to. As a litre of petrol approaches £1 in the UK for example, you will only pay 56p in Australia. One of the most important items to purchase on your arrival will be a new barbeque – for a 4 burner gas BBQ it will cost £73 in Australia compared to £150 in the UK. (UK prices based on exchange rate at time of writing). For the majority of UK migrants heading to Australia, the first part of the migration process involves making a visa application payment which can be problematic to begin with. Because the payment needs to be made in Australian dollars, your credit/debit card company may not authorise the payment because it constitutes an “irregular” spending pattern alongside more normal payments to the local supermarket or petrol station. This will result in the application being return and in some instances, valuable time lost. Migration currency specialists HiFX have made the whole financial aspect of your migration as simply as possible, right the way through to opening bank accounts for you on arrival. The visa application payment can be made by debit or credit card and HiFX will raise an Australian dollar bankers draft and send it back to – saving you time and money on the rate of exchange. When transferring your assets from Sterling to Australian dollars, interest rates and the inflation outlook impact the currency markets and will therefore have a direct impact on a migrants future wealth. But how can you protect yourself if your funds are tied up in your property for example? Even if you do not have all the funds available, you can buy currency with a forward contract. This is when you fix the rate of exchange at the time with a 10% deposit, but do not have to pay the remaining 90% until you need or have the money available. Rates can be fixed for up to 2 years and a forward contract is flexible to allow for changing time scales. By locking into an exchange rate, you are guaranteeing your future wealth or securing the cost of any purchases in both dollars and sterling. There is no need to put your self under pressure to change your money in one transaction and many people chose to spread the risk of currency movements by changing their money in tranches. To discuss your requirements in more detail and for a free currency consultation please contact the Migration Team at HIFX plc on 01753 859 159 or by emailing us at migration@hifx.co.uk



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