November 20, 2018 - Written by John Cameron
STORY LINK Pound Sterling Australian Dollar (GBP/AUD) Rises on US-China Trade Tensions
GBP/AUD Exchange Rate Rises despite Brexit Worries as US-China Trade Tensions Flare
The Pound Sterling Australian Dollar (GBP/AUD) exchange rose slightly after global trade tensions flared up again following the recent Asia-Pacific Economic Cooperation (APEC) meeting
The Australian Dollar (AUD) continues to suffer from ongoing US-China trade tensions, providing Sterling with the chance to capitalise on the ‘Aussie’.
Sterling is currently trading at AU$1.7667 against a weakened Australian Dollar in the wake of the meeting.
Pound Australian Dollar (GBP/AUD) Exchange Rate Strengthened after Carney Backs May’s Brexit Deal
The Pound (GBP) strengthened on the Australian Dollar (AUD) today after the Bank of England (BoE) governor, Mark Carney, backed Theresa May’s Brexit deal, saying that he welcomed the ‘transition arrangements in the withdrawal agreement.’
Carney’s statement also expressed support for the EU’s chief Brexit negotiator Michel Barnier’s recent remarks on the possibility of extending the Brexit transition until the end of 2022, saying that MPs should ‘take note of the possibility of extending that transition period,’ despite Theresa May’s rejections.
Nevertheless, the Pound remains volatile as the threat of a vote of no-confidence lingers over the Prime Minister, with 26 MPs having made public their decision to try and oust her.
Global Trade Tensions Dent Australian Dollar (AUD)
The Australian Dollar (AUD) benefited slightly after the governor of the Reserve Bank of Australia, Philip Lowe, calmed concerns over any sudden rate moves.
However, the Australian Dollar Pound (AUD/GBP) exchange rate then dropped over concerns about global growth, with the Reserve Bank of Australia’s Philip Lowe also adding that international trade protectionism was a “significant” factor to present further risk to AUD.
GBP/AUD Outlook: Pound to Australian Dollar (GBP/AUD) liable to React to Brexit News
The Pound Australian Dollar (GBP/AUD) exchange rate is likely to be affected by any Brexit developments over the coming days – especially if they involve Theresa May, who remains vulnerable due to the increasing disagreement over her proposed deal with the EU.
Furthermore, US-China trade war talk could continue to cause issues for the ‘Aussie’, and will likely be a catalyst for an AUD/GBP slump if fears persist.
With very few Australian ecostats due for publication this week, GBP/AUD is likely to be driven by political developments, with markets focusing on Brexit headlines until there is ultimate resolution in the matter of the UK-EU relationship.
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TAGS: Pound Australian Dollar Forecasts