After the Australian dollar grew to a 27 year high against the British pound recently, PayPal has predicted that there will a surge in Australians shopping in the UK.

Just like how the weak American dollar drove Australians to US retail sites, PayPal expects traffic between Australia and the UK to spike over the next month as savvy Australian shoppers benefit from their newfound purchasing power against the pound.

Elena Wise, PayPal Australia, acting managing director,  said: “Smart online shoppers are taking advantage of the global shopping mall and know where to shop for the best deals.  We regularly see changes in the spending patterns of our 4 million active customers in response to fluctuating global currencies and the most popular corridors from Australia continue to be the US, the UK and China”

Over the last year, UK retailers have sharpened their focus on selling to Australian consumers, with many now offering reduced and free shipping, local pricing and simplified returns policies. UK sites leading the way include TopShop, eBay, ASOS, Oasis, Figleaves, and Book Depository. These investments, along with the strong Australian dollar could intensify the competition to Australian retailers from overseas throughout 2012.

 “Australian retailers are being challenged to compete on a global stage and we are now seeing established Australian brands fighting back against international competition by offering a truly integrated approach to retail. This approach merges retailers on and offline presence, allowing them to use their established offline footprints as a competitive advantage to win back the consumer,” Wise said.