Moving to Australia is a long process and it can be easy to let the whole prospect become stressful. While we at the Visa Bureau do all we can to help you obtain your Australia visa to allow you to move in the first place, we have plenty of friends and partners to help you in other ways.
Once you've got your visa, the logistics of the move can begin: where to live, schools for the kids, cars to drive, getting your stuff to Australia... the list can become overwhelming, if you let it.
One of the areas however that is often overlooked, misunderstood, or both, is dealing with a new currency.
While the Pound Sterling and the Euro have been wallowing in depressing lows for a considerable amount of time, the Australian Dollar has soared, fuelled by the country's mining boom.
This has been great for Australians but has made moving to Australia, that little more expensive.
But things are changing now, the once so powerful mining boom is beginning to slow and there may be opportunities in the near future for the soon-to-be-mover to capitalise.
We spoke to David Johnson, director of Halo Financial, for his views on getting the most for your money during your move to Australia.
China's economy has undergone one of the biggest and quickest economic surges in history in the past few decades and the benefits have been widespread. Australia's own economy has thrived thanks to ongoing Chinese demand for Australia's abundant natural resources.
However, the boom-bust nature of economics means high demand won't last forever and Mr Johnson says there has been change in Chinese policy in recent months and potential migrants would be wise to keep their eye on Asia in the coming months.
It may seem odd to suggest someone migrating to Australia should keep an eye on China but it is worth doing. China’s economic growth or contraction has a direct impact on the Australian economy. To give some measure of that importance, China takes 28% of all Australia’s exports and the percentage of iron ore, gas and coal is greater still so a slowdown in China is a very big deal indeed for Australian business.
A slowing economy causes concerns over the future demand within China for Australian goods and that weakens the Australian Dollar due to the impact that falling demand would have on Australia’s industry; especially the mining sector.
This past week has brought data showing slowing growth and retail activity in China and news that 40% of China’s steel and iron factories are closed due to low prices in the commodity markets. As a comparison, iron ore prices hit an all-time high of $200 per tonne in early 2011 but hit a fresh 3 year low of just $89 per tonne in September 2012. That obviously puts a huge hole in the income of iron ore producers in Australia and elsewhere; hence the pressure it puts on their currencies.
Within the financial markets, there is increased speculation that Chinese authorities will have to take action to boost growth and stabilise the economy before it shrinks further. If the data for the 3rd quarter of 2012 reflects further decline, they may not have a choice.
How does China's economy affect my move to Australia?
China's economy is currently on track to surpass even the United States' in the relative near future and usher in the start of the Asian Century. While it may not seem as though what happens in Asia can impact the transferring of money between two entirely separate countries, Mr Johnson says that is clearly not the case.
However, by the use of clever financial planning and some of the services on offer at Halo Financial, any changes on the national or even international scale in China can work to benefit you.
In essence, what happens in China will directly impact how wealthy you are when you arrive in Australia. More importantly - and less passively - if you are aware of how China is influencing the value of the Australian Dollar, you can use that knowledge to help time your Sterling to Australian Dollar transactions to ensure you capture the best exchange rate the market has to offer in the timescale that suits your plans. The availability of forward contracts and automated market orders through Halo Financial means that even if the exchange rate is exceptional but your funds aren’t all available yet, you can still take advantage of the opportunity. It also means you can protect yourself against the worst rigours of the market.
For example, those who waited when the market bottomed out at A$1.46 in March will have been grateful they did so in May when the Pound reached A$ 1.651 and those who bought forward contracts when the market was up at A$1.61 in May would have every right to feel smug when the market fell to A$1.47 in August.
In the next few months, the target at the top of the range is still just above A$ 1.60 but the trend is still on a downward trajectory and the bottom of that range can be found at A$1.44.
With all the uncertainty in the global economy and the nervousness over China’s plans, we are likely to visit both ends of that range before 2012 is over. All I would hope is that with your plans, your time frame and our market expertise, you would allow Halo Financial to help you to make the most of your currency conversion you arrive as an affluent Aussie and not a poverty pom.
- Dominic Ladden-Powell is the Online Editor for the Australian Visa Bureau.
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