By Edwina Shanahan @ Visafirst.co.uk

Some really big changes are to be introduced to the Australian Skilled Migration Programme on 1 July 2012.

The Skilled Migrant Selection Register (SkillSelect) is a new Australian visa programme aimed to ensure that only the best and brightest skilled migrants are selected for visa processing. On 1 July, SkillSelect will replace the existing skilled migration programme, and will reform the way Australia selects skilled migrants for visa processing.

SkillSelect gives the Australian government more control over who they let into the country – but it will create significant uncertainty for wannabe skilled migrants.

It will particularly affect those interested in independent, family, state or territory sponsored and business skills migration.

 So how will it work?

SkillSelect is based on an electronic two-stage process whereby intending migrants:

• (Stage 1) submit an Expression of Interest (EOI)
• (Stage 2) are invited to apply for a skilled migration visa by the Department of Immigration and Citizenship (DIAC)

Despite lodging an EOI, there is no guarantee that applicants will move on to stage two (ie. be invited to apply for a skilled migration visa). They will remain on a database of interested applicants ranked by points, date of application and occupation for up to two years. After that time’s up, if they haven’t been invited to apply for the visa, the EOI is removed and it’s game over – that application has failed.

When lodging an EOI, applicants must meet the points criteria, have their skills assessed AND have had an English language test already carried out. So there will be a financial outlay without any guarantee of being invited to lodge a visa application.

It is also worth noting that quotas will be introduced to this new system to prevent the pool being dominated by a narrow range of occupations. Once the limit is reached each year, there will be no further opportunity for anyone in that occupation to apply.

Would-be migrants can submit another EOI once the two-year period has lapsed.  Again, they must meet the necessary visa requirement including the minimum pass mark and the relevant occupation quota must not be full.

After all this cost and work, there’s still no guarantee of an invitation letter to apply for a permanent visa.

So if you’re thinking of applying for permanent residency, there really is no time like the present. It’s going to get a whole lot harder this year.

You should get your application lodged as soon as possible to prevent your being affected by the July 2012 changes. Only five more months of the current system!

For more information visit VisaFirst.com. Would-be migrants can call VisaFirst.com for a free assessment to see if they are eligible

In Australia, there are two schools of thought about whether to include career objective statements in résumés. Read the rest of this entry »

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Taking part in a face-to-face or telephone interview is an exciting, but daunting, thought for most job applicants.  Attending an interview for a job in Australia can be even more stressful for people who are newly arrived, or those for whom Australian English is not their mother tongue. 

Although Australia is famous for its relaxed culture, Australian employers and recruiters take interviews very seriously.  So in today’s Career Suite article, I’ve compiled a list of seven tried and tested tips to give you the best chance of impressing your interviewer or interview panel. 

 1.       Be prepared

• Arrive at least ten minutes early
• Check the location of the interview in advance – if you don’t know the area, make a trial run beforehand to ensure you arrive on time, especially if you need to use public transport to get there.

 2.       Research the organisation  

• As a well-briefed applicant, you will show the panel that you are taking the job seriously and are keen to be part of the organisation
• There’s no use researching unless the interviewer knows you’ve made the effort to do so, so introduce points from your research into your answers to the interview questions wherever possible. 

3.       Address the panel members by name

• Take a notepad and write down the name of each interviewer after the introductions.
• Refer to your notes and use their names throughout the interview.
• If an interviewer introduces themselves with their first and last name, for example “Hi, I’m John Smith”, it is courteous to call them “Mr Smith” during the interview.  If they would like you to call them “John”, they will invite you to do so.

 4.       Ensure you dress in a manner that reflects the occupation

• If you are not sure what to wear to your interview, it is best to dress too formally than too casually. 
• If you are being interviewed for a corporate professional role, or in a conservative business environment, it is best to wear a suit.
• For other roles, in Australia it is appropriate to wear smart casual business attire to interviews.   
• Make sure that your grooming is immaculate, even if you are applying for a role that doesn’t require customer or client contact. 
• If you are a smoker, do not smoke within half an hour before the interviewer.  If you walk into an interview with the smell of cigarettes on your breath and clinging to your clothing, it could leave a bad impression on a non-smoking interviewer. 
• Wear an outfit that you are comfortable in, so you are not distracted during the interview.

 5.       Answer questions comprehensively

• Take a moment to consider each question that is put to you.  Stay calm, organise your thoughts and give a focused answer.
• Wherever possible in your responses, relate your experience to the duties of the role you’re applying for.
• Answer questions comprehensively, but resist the impulse to keep talking after you have addressed each part of the question.

 6.       Watch your body language

• When you are introduced to the interviewer or panel, make sure your handshake is firm and confident.  A weak handshake is as bad as one that it so strong it crushes the recipient’s hand.  Neither will impress your interviewer.
• Make eye contact with the interviewer throughout the interview. 
• If you are participating in a panel interview, each interviewer will ask you one or more questions in turn.  Respond primarily to the interviewer who asked the question, but include the others in your response, by making eye contact with each of them as you respond.

 7.       Thank the interviewers

• At the conclusion of the interview, thank the interviewers and follow up by sending a brief thank you note within three working days of the interview.

Do you have a question about the Australian jobsearch process? Post it in the Embrace Australia forum, or visit Susan Wareham McGrath at Australian Career Suite for more information about applying for a job in Australia, working in Australia and changing careers in Australia.

Your pension no longer has to follow you Down Under - but there are tax implications to consider

If you’re lucky enough to have a British pension (an increasingly rare perk these days), and are looking to uproot to a new life Down Under, you won’t want to be leaving your retirement stash for dead. But a lot can ride on when you decide to transfer it, where, and how.

We spoke to Geraint Davies of Montfort International about the need to plan for a secure retirement. Relying on the Government is clearly unrealistic. Anybody moving out of the UK therefore needs to weigh up what to do with their current pension arrangements.

More and more migrants are becoming aware of Qualifying Recognised Overseas Pension Schemes (QROPS)… but is an Australian QROPS the ultimate panacea to cure all retirement planning woes? There’s plenty to think about in terms of when – and indeed whether – to transfer a UK pension to Australia.

Is it true that I have to move my pension fund within six months of emigrating? 

GD: No, and you don’t have to move your pension to Australia even after 6 months.  Many migrants make this mistake. In years gone by, you had to move your pension fund because of a very nasty Australian tax assessment on your UK pension. Now, not only have the tax rules been totally overhauled, but QROPSes have arrived. The tax hit has been toned down and you no longer have to move your pension to an Australian scheme.

There are 43 countries that operate a QROPS solution for those who call Australia home. And as for the six-month transfer rule; this is a common ploy used by Australian advisors to spook UK pension holders to transfer to an Australian superannuation scheme, when it’s not necessarily in their best interest.

Its true, however, that any transfer to an Australian scheme will only be tax free if made within six months of migration. It’s also true that if you move it within, say, 12 months and the scheme grows by 10 per cent (those were the days!), then the tax deducted from the fund would normally be less than about 1.5% of fund value… and the exchange rate can match that within a day.

Do I have to move it at all? 

GD: No, you don’t. This strategy of moving a scheme to Australia was abolished in 2006.  Today it’s a much more complex and finely balanced decision process. If you are being told by an advisor that you must transfer it to Australia, then walk away. And if you’ve already transferred, get an expert to check out the advice you were given, because you may be due some explanations as to why your retirement plans are needlessly and prematurely trapped in an Australian superannuation. You may find yourself unable to opt for an early retirement, while other expats can.

Under current rules, you can leave your pension where it is until you retire. In 99% of cases it’s not necessary to move it out of the UK. If you have been told this then you should register a complaint against the firm and ask for an advice review.

Can I move my pension to another, third-party country that isn’t Australia?

GD: Yes, and your advisor should discuss what options other countries offer. Some other countries will let you access your pension earlier than the UK (at age 55) and Australia (at age 60), so it’s not only worth looking into, but a necessity when an Australian advisor is keen to get you to transfer..

With such a weak pound at the moment, is it a bad time to transfer my pension?

GD: With the exchange rate as it is, I would only transfer into an Australian fund if it can hold your funds in pounds and allows you to withdraw in pounds (in a form that does not force you into a foreign exchange transfer). Really, I’d only consider this if you need the income to live on immediately. Why move funds when the foreign exchange is at its lowest in living memory? You’ll just lose money. You need to devote serious time to understanding your options.

Can I move my fund back to the UK again later on if I need to?

GD: Not without hiring some serious technical expertise. A recent case saw a fee of £20,000 being charged just to embark on the process. It seems outrageous, but that’s going rate for digging that person out of the deepest of tax holes. This required re-drafting of what is called the Trust Deed scheme rules, which is why it’s such a very expensive move. So don’t go there – don’t move a fund to Australia until you know you’re definitely staying for good, regardless of what the foreign-exchange rates are doing.

So what if I don’t stay in Australia? Does my pension scheme remain marooned there? Can I withdraw it from Australia at retirement age?

GD: Yes, you can withdraw your Australian pension when you retire, but if you are back in the UK, there’ll be a massive UK tax charge on return. It’s really not worth moving a fund to Australia, unless you’re 110% sure you are staying for good. If you keep your fund outside Australia for as long as you can (and that doesn’t mean leaving it in the UK), you won’t have to pay these taxes.

And will it be taxed as income in Australia? 

GD: It depends. Take these scenarios: A non-Australian QROPS delivering income to an Australian resident’s UK pension fund would be tax assessable. Meanwhile someone on a temporary visa, who is a tax resident in Australia and draws income from a non-Australian QROPS, will not be taxed on that income. Drawing from either a UK scheme or an Australian superannuation will be taxable on that income.

See how finely balanced this decision process actually is. But if you transfer it into an Australian superannuation scheme, as an Australian resident you wouldn’t normally have to pay tax on it. This is one of the advantages of transferring your pension to Australia, actually – as long as you know you’re staying put.

• With thanks to Montfort International

Surfers Paradise in Queensland; this is what awaits you

Once you have made the life changing decision to move to Australia there are a number of things you will need to do; buy you plane ticket, organise a visa (which really should have been done a long time ago but we’ll come back to it later in case you haven’t), decide which fabulous city you want to call your new home and last but certainly not least you will need to organise the moving of all the things you have accumulated over the years and just can’t bear to leave behind. 

This means using one of the UK’s many international removals companies but don’t worry, we’ve done the hard work, the ringing round, the research for you.

John Mason International Movers

John Mason International Movers, established in 1884, is one of the UK’s leading international moving and shipping specialists, having developed their service over the last 125 to become one of the best and most prestigious companies of their sort. From wrapping your most prized possessions in dreary old blighty to unwrapping them down under JMI will oversee your move down to the last detail, taking the stress out of relocating.

First of all preparation is key; while JMI use experienced and professional packers and movers it is important to have everything organised before they arrive, particularly personal items so that there is no cause for staff to invade your privacy.

You will have a Move Manager assigned to you, they will organise everything for you from start to finish and will be your point of call if you have any questions, they will keep you informed as your move progresses so that you are never left out of the loop.  

John Mason recommends that an average household will require the exclusive use of a 20ft steel shipping container, this is the fastest way to get your belongings to you by sea; average shipping time is between 8 and 10 weeks.

Another choice is to share a container which if you only live in a one bed flat is a better option as you will be sharing the cost of transit with others. This option does however take longer as the container will only be shipped once it is full. For this option add another 2 weeks or so to the estimated delivery time.

Air Freight is another option and a good one if you have belongings you simply cannot survive without as it is much quicker however you will pay considerably more for the service.

JMI advises customers that it’s generally cheaper to ship items than to replace them and they have a handy quote generator on their website so that you can see how much it would cost to replace your home contents upon arrival in Australia compared to the cost of shipping.

Because JMI are specialists in international moving they have extensive experience of dealing with customs authorities and transport links around the globe.

When moving to Australia you can move any items such as household goods and personal items you have owned for more than a year duty free. All items being imported into Australia are inspected by the Australian Quarantine Inspection Service (AQIS) which can take up to 14 days.

AQIS look for anything which may have come into contact with soil or vegetation from you country of origin as Australian customs are extremely protective of Australia’s native flora and fauna. For this reason it is suggested that the soles of all shoes are cleaned thoroughly and disinfected.

If AQIS find anything which does not pass their inspection they may suggest further cleaning which you will have to meet the cost for.

A quick word of warning

There are a number of items which cannot be taken into Australia, some may be seized and destroyed while others may also carry fines and other penalties. Items which cannot be taken into Australia are:

• Vegetation, soil, food and drink.
• Fireworks or any other explosives including pressurised containers.
• Large amounts of cash and jewellery.
• Pornography of any kind.
• Firearms (unless you have contacted Australian customs and received permission from the Territory Police Registry in the form of a permit B709a prior to moving.)

It is always advised that items being transported are insured because while every possible measure is taken to ensure the safe delivery of your possessions, John Mason cannot guarantee against unforeseeable circumstances.

Now let’s deal with visas, there are a few options available to someone moving to Australia, all of which are explained on our Australian Visas page.

Whenever and however you choose to move to Australia, John Mason International Movers, with their professional and experienced staff will be able help you make the transition smoothly and quickly.

Introduction

Australia draws people from around the globe with its relatively stable economy, high standards of living and equally high life expectancy. The land Down Under has good education and health care, not to mention a wealth of outdoor space, natural wonders and unrivalled sunshine.

So whether you’re looking to quit the UK in favour of a better climate and a better way of life or invest in a market that has managed to avoid the worst of the global financial crisis. While property prices in the UK (with the exception of central London) have dropped considerably and are likely to fall further, those in Australia have not been affected.

Many believe that the Australian housing market is impervious to the crisis which has gripped most of the rest of the world while others say that house prices are and have been artificially inflated for some time and the cyclical nature of all housing markets means that Australia is due a downturn. Only time will tell how stable the market is but the simple fact is that house Prices in Sydney are soaring and those in Perth, Melbourne and Canberra are showing signs of following suit.

Overview

Unlike the UK, Australia’s property is primarily single story but like the UK the easiest way to make a profit is to find something under market value and to renovate or choose an area undergoing regeneration.

There are estimated to be 131,000 new dwellings being built in 2010/2011; 50,000 less than is required to even keep the housing shortfall at a steady level. This lack of housing is pushing property prices up and in many areas out pricing first time buyers according PK Property.

Due to high property values out pricing most first time buyers now is the opportune moment to invest in buy-to-let properties. Rental vacancies in Sydney are at a record low of 1 percent meaning that the area is crying out for rental properties.

When looking to purchase a buy-to-let property the foreign investor should be aware that the government has a number of restrictions on such business. The general rule is that to invest you must be living in Australia either temporarily or full time whether this is through a Temporary Entry Visa, a student visa or someone being granted a Permanent Residence Visa.

No matter how many properties you buy, where or when or how long you own them for, if you leave Australia and do not have a valid bridging visa you must sell all real estate even if it will be at a loss.

There is an exception to the rule however; if you apply to the FIRB (Foreign Investment Review Board) permission may be granted to purchase vacant land or an existing property for investment purposes if the investment can be proved to assist the local community and its housing needs.

Projections

Sydney property has a long term trend of doubling every 7-10 years and BIS Shrapnel, a leading economic forecaster has predicted a 21 percent rise over the next three years based on the estimation of a shortfall of 308,000 dwellings. In the long term the gap between supply and demand will only increase due to restrictions on building and the ageing population.   

You don't get a view like that volunteering in the UK

Volunteering can be one of the most rewarding things a person can do, whether it is helping out in a retirement home, working with children or for a charity but why stop there when you can see a different part of the world and do something really amazing.

Australia has a wealth of opportunities for those looking to broaden their horizons and take part in volunteer work whether it’s a gap year experience you want or a summer holiday to remember. Whether it’s childcare, construction, conservation or community work there is something to take part in.

The Australian National Volunteer Week runs from the 9^th to the 15^th of May and will celebrate and highlight the role of volunteering in Australia. This year’s theme for National Volunteer Week is ‘Inspiring the Volunteer in You’ and is the perfect opportunity to take part as during this week companies will be looking to recruit volunteers.

Roughly 5.4 million people, that’s around 34 percent of the adult population of Australia volunteer each year, most of which is working with organisation that help children and the homeless. If you have aspirations to be part of that number then read on.

How To Get There

When volunteering in Australia you always need to budget for flights as even package deals rarely include these and flights often cost more than your accommodation. For an idea of costs check out our Travel section.

Visa

The easiest way to get to work in Australia is to apply for a temporary work visa which will allow you to work in Australia for up to 12 months, a tourist visa will also work because you will not be paid for the work you undertake. A more complicated route is to get an employer to sponsor you however this generally applies to those moving to Australia for a longer period of time. For more details take a look at our visas section.  

Construction

If you have construction skills and want to use them to make a difference keep your eyes open for volunteering opportunities in Queensland which is still in the grips of its most destructive summer on record as there will be more than enough rebuilding work to go around.

The best place to look in the wake of Cyclone Yasi is FNQ Volunteers, the official portal for volunteer work in Far North Queensland, the website is updated with daily volunteering opportunities for those who want to get there then organise work however there will be opportunities to help with the rebuilding efforts in the long term.

Conservation

There are a number of companies that offer a range of package volunteering holidays. One such company is i-to-i, a web based company that offers conservation package experiences in Australia which allow you to immerse yourself in the culture, the land and the vital work you will be doing.

You can take part in conservation projects that last between 2 and 10 weeks with the cost starting at £599 for 2 weeks and £150 for each week after that. There are projects all around the country for you to take part in; these include reforestation, river and creek preservation, walking trails and wildlife data collection, all of which are arranged in partnership with hundreds of established projects. Accommodation varies depending on where you are based and details will be confirmed upon booking.

Real Gap Experience offers gap year students and backpackers the opportunity to sign up to their website for £89 and receive details about a wide range of volunteering opportunities for 12 months. This service caters for those who are planning on making it up as they go along so you can get there and take a look at what is going on in your area then get involved, it really is that simple.  

Gap Year For Grown Ups also offers package holidays that are generally geared around conservation, prices start from £599 but there are a range of deals that you can do depending on how long you want to volunteer for and if you are going to be in Australia for a long time, how often.

Working With Vulnerable People

Those who have a passion for care work whether it is childcare, working with the elderly or with those with disabilities, volunteers will need to undergo police checks similar to the CRB checking process in the UK. This can be time consuming so you need to make sure that you will be in Australia long enough to make this worth it. 

Volunteering.com.au has details of volunteering jobs all around New South Wales across all sectors and help with applying for them. If you are not sure where in Australia you want to be, or you do and want to look a little deeper check out or city guides to see what possibilities await. 

Whatever it is you want to do, make sure you make the right choice and do it down under because not only will you be able to take part in some of the most rewarding work but you will get to experience a country known around the world for its superior quality of life. Who knows, if you like it enough, you could end up staying.

Tree surgery involves all aspects of tree maintenance including diagnosis, pruning, transplanting and felling. It is often a dangerous profession as tree surgeons often work with large, very old trees that pose a danger to the public. 

The Tree Surgery industry in Australia is booming and is crying out for skilled immigrants to plug the hole left by a lack of training. I spoke to Tristan Herridge, a British tree surgeon working in Australia to find out what Australia has to offer.

Q. So Tristan, why did you decide to make the move to Australia? Is it really so much better than in the UK?

“For a start, pay is around fifty percent higher than UK, it can be double if you’re prepared to climb challenging trees daily and there is no end of opportunities for tree work in Oz. The Lifestyle is wonderful, money to live is ample and a five day week allows for everything you may wish to do and still money saves itself.

There is a lot of development going on, a small population and lazy tradesmen! The young tree work industry means few people have the experience or training to work efficiently, leaving plenty of room for skilled people like myself to come in and do the job properly.

Work is much easier than UK as well, there are more specialised (and larger) machines; winches, kanga mini-tractors to drag timber, huge American chippers (two foot chipping diameter instead of ten inch!)”

Remember that working with machinery requires certification which can be attained through practical courses; these can be undertaken at most agricultural colleges and are reasonable low cost considering that once undertaken they allow you to immediately undertake more complicated, dangerous and better paid work.   

Q. I see, so it sounds like you have the best of everything out there. What do you do on a daily basis?

“At present I mostly work on domestic contracts, i.e. privately owned properties (garden pruning/felling) and occasional

tree surgery is vital to protect the public and the local tree population

 construction site clearance. Mostly we fell trees, the gums (eucalyptus) grow incredibly fast and people generally have other trees growing nearby, termites are a problem, die-back (phytophera) is spreading through the native tree population and canker is rife in the hills around Perth. These all de-stabilise a tree into decline and create work for us.

The properties here are generally much larger than UK due to the fact there’s much more land and far fewer people; that allows us to use cherry pickers (elevated working platforms) and larger machines for tree removal.

I work from a 14m trailer mounted picker or an 18 m truck mounted picker. I climb maybe a few times a week. It’s so hot here in drought ridden Western Australia through summer (40 degrees some days, average 30-35) climbing constantly would be a challenge.”

Q. Where did you find your job? Did you look at the skilled immigration list?

“No, I found my job through a web site called arbjobs.com, it is far simpler to find the job through an employer who is willing to sponsor you rather than scroll through a huge list. If they’re advertising then obviously there are jobs out there and being in the industry already I knew where to look.”

Q. And your visa, how did you find the process?

“It was simple really; the visa took an hour online and around 150 pounds. I also needed a chest x-ray because of the work but there were no real complications.”

There are many visa options depending on your length of stay and your personal status (dependents/skills). 

Q. That’s great, I think we’ve covered just about everything. Just one last question, what does the future hold for you, is there much opportunity for career progression?

clearing power lines is dangerous work but very well paid

“In the new year I will be trained for power line clearance. It’s mind-numbingly boring work but will allow me to travel around the state and work in the remote outback for weekly contracts. I can visit some unique places and be paid to do so.

This kind of work is paid with a bonus scheme and the wage is excellent. The working away is carried out through the Aussie winter; May to October as the fire restrictions are lifted as the climate dampens a little”

Working in this specialised field can be very lucrative as few are able to carry it out. In Australia in particular this is necessary as power lines can travel across hundreds of miles of unpopulated land and must always be kept clear in case of extreme weather.

Australia has a population of over 22 million and a total area of almost 3 million square miles, relatively small compared to the UK. This means that there are huge areas of land which are completely unpopulated but do need to be maintained in order to keep transport links open. 

If you are interested in becoming a tree surgeon then contact your nearest agricultural college for details on courses you can undertake. Even after basic training it is possible to make the move to warmer climes in order to carry out your dream job. There are major tree surgery companies based in all major cities around Australia and these may be your first port of call, alternatively you could set up on your own if you can afford the necessary machinery and have enough drive.

To be more precise, the exchange rate you receive when you convert your funds really matters and there are three main elements to making sure you get the best of the exchange rate when you do convert your funds to further your migration plans.

• The right time
• The right source
• The right contract

Timing is so important

The Sterling – Australian Dollar exchange rate tends to change by around 1% every day and nearly 6% in a month. It is trading as part of the largest financial market in the world so you and I cannot stop the clock ticking or the exchange rate moving. However, we can take advantage of the opportunity that this movement offers. In essence, even if you just time your transaction better within the month, you can arrive in Australia with 6% more wealth than you started with.

Where to buy your currency from

You are probably as perplexed as the rest of the world at the variation between the ‘We buy’ and ‘We sell’ exchange rates on the boards at banks and bureaux de change however, you need to remember: cash is expensive to handle, it has to be manually counted, stored in safes, moved by secure transport, insured along with a range of other factors. So the profit margins applied to cash transactions are defendable to a certain degree.

However, there is no excuse for applying those same exchange rates to wire transfers and yet that is what UK high street banks will tend to do. A profit margin of 5 to 8% is the norm and that is money straight out of your pocket. They will also, often apply those rates without confirming the exchange rate in advance and that is akin to writing your bank an open cheque.

A specialist broker like Halo Financial will work on a much smaller profit margin and will specify the cost and exchange rate in advance of agreeing the transaction so you are not left in the dark. A saving of 5 or 6% is not unheard of and with assistance on the timing of the transaction, the saving could amount to 10% or more.

A suitable contract

If you need to exchange your money now and send it straight to Australia then a ‘spot’ contract is just the job. Immediate transfers are arranged like this across the globe every second of the day. However, what if the exchange rate is terrific but your funds are not quite free from the house sale yet or are still caught up in an investment?

Well you can still take advantage of the exchange rate you want but rather than agreeing a ‘spot’ contract and settling immediately, you can pay a small deposit (usually 10%) and agree a settlement date up to 2 years in advance. (This is Halo Financial’s arrangement but other brokers may vary). This allows you to capture the right exchange rate, cut your risk and ensure you can budget for the big move.

And what’s happening in the market

As mentioned above, the Sterling – Australian Dollar exchange rate is a volatile one and this past few months has been no exception.

The Reserve Bank of Australia (RBA) has moved interest rates slowly higher but chose to keep the base rate at 4.75% when their monetary policy committee last met. Investors and traders have taken this as a signal that we will not be seeing any hikes for some time to come.

The reason for the RBA’s reticence can be summed up in one work, China. The Chinese market is immensely important to Australian exporters and China’s moves to slow growth are a clear and present threat to Australian economic growth. In light of the changes being made in china, Australian export sales are likely to come under pressure and that has implications for jobs and domestic spending levels.

However, the fact that Australian bonds pay an interest rate yield based on the current 4.75% does make them some of the most lucrative in the industrialised world and that is a very compelling argument for buying Australian Dollar denominated bonds. It is this flow of funds that is keeping the Sterling – Aussie Dollar exchange rate below A$ 1.63 and it is this flow that has caused this pair to fall from A$ 1.80+ in July to below A$ 1.60 today. We are very near to the lowest this exchange rate has been in a quarter of a century.

What next then? Well as long as the UK economy continues to post improving statistics and as long as China follows through on its economy slowing policies, we may well see a break above A$ 1.63 and perhaps a test of the A$ 1.69 or even A$ 1.71 level in the weeks ahead. But, there is a level of Sterling buying interest at A$ 1.58 and, if that breaks, we could well be heading for record lows in this exchange rate with no real idea of just how low we could go.

It sounds a gloomy picture but, given the balance between the UK and Australian economies, you would have to plump for Australia. And in fact, maybe the reason you are reading this report is that you have made that decision already; voting with your feet rather than just trading the exchange rate.