December 13, 2018 - Written by John Cameron
STORY LINK Pound to Australian Dollar Exchange Rate Today: GBP/AUD Stabilises as Theresa May Survives No-Confidence Vote
Pound Australian Dollar (GBP/AUD) Exchange Rate Steady on May Brussels Trip
UPDATE: The Pound Sterling Australian Dollar (GBP/AUD) exchange rate held in a narrow range during the European session on Thursday as markets await the outcome of Theresa May’s trip to Brussels.
May has said she will discuss the ‘legal assurances’ her MP’s are seeking over the Irish backstop with EU leaders in an effort to alleviate their concerns before it is finally put before parliament in January.
GBP/AUD Exchange Rate Steadies as May Emerges Victorious after Yesterday’s No-Confidence Vote
The Pound Sterling Australian Dollar (GBP/AUD) exchange rate steadied today, and is currently trading at AUD$1.7514, after British Prime Minister Theresa May survived last night’s no-confidence vote headed by Tory MPs.
Theresa May won the no-confidence vote with a majority of 63% backing from Conservative MPs, with 37% voting against her future as Prime Minister, leaving the Pound (GBP) steady against the ‘Aussie’ with May’s position secured.
Laura Kuenssberg, Political Editor at the BBC, tweeted:
‘Of course her colleagues in govt relieved that she can try to carry on but it's a survival not success tonight - another big knock to the PM's credibility, and no solution at all to the gridlock in Parliament - she's survived, her Brexit compromise can't in its current form.'
The Australian Dollar (AUD) meanwhile was strengthened by news that US-China trade tensions are showing signs of thawing after China’s announcement that it will change its Made in China 2025 plan.
GBP/AUD Exchange Rate Rangebound as May Rallies to Gain Support for her Brexit Agreement
The Pound (GBP) took a slight hit from today’s release of November’s RICS housing price balance which showed a worse-than-expected decrease at -11% against September’s -10%.
GBP investors, however, have had their attention mainly on Brexit, with Theresa May’s victory yesterday encouraging market confidence that her Brexit withdrawal deal being seen through to completion.
Theresa May commented after last night’s victory:
'Whilst I am grateful for that support, a significant number of colleagues did cast a vote against me and I have listened to what they said. . . [A] renewed mission – delivering the Brexit people voted for, bringing the country back together and building a country that really works for everyone.'
Today saw May head to Brussels to renegotiate aspects of her Brexit withdrawal agreement, with Sterling investors becoming increasingly concerned over whether the EU will be willing to amend issues over the Northern Ireland backstop.
Australian Dollar Pound (AUD/GBP) Exchange Rate Steady as US-China Trade Tensions Thaw
The Australian Dollar (AUD) was strengthened today by the release of December’s consumer inflation expectation figures which showed an increase to 4.0% on last month’s 3.6%.
‘Aussie’ traders have had their sights set on improving US-China tensions, with the Head of FX Strategy at the National Australia Bank, Ray Attrill, commenting:
‘China is considering delaying some of its targets to 2035 and put more focus on improving industry standards . . . [This being] perhaps the main sticking point in the US-China trade war, and a change in direction from China on this front would increase the chances that the two sides come to an agreement next year.’
Later on today will see the publication of the Reserve Bank of Australia’s (RBA) latest bulletin with AUD investors paying close attention to any signs of a recovering Australian economy.
GBP/AUD Outlook: Theresa May’s Withdrawal Agreement in Spotlight
The Pound Australian Dollar (GBP/AUD) exchange rate is likely to be driven by political factors this week, with Theresa May once again rallying to bolster support for her Brexit withdrawal agreement after winning last night’s vote of no-confidence.
The likelihood of May’s UK-EU withdrawal agreement succeeding through Parliament is also causing Pound (GBP) investors to remain cautious.
Looking ahead, next week will see the release of the UK’s Rightmove house price index for December, with any signs of an increase potentially helping Sterling.
Wednesday will see a slew of UK data releases, most notably the release of November’s retail price index.
Meanwhile ‘Aussie’ investors will be paying close attention to the release on Tuesday of the RBA’S meeting minutes, with any signs of hawkishness strengthening AUD.
Tuesday will also see the release of Australia’s HIA new home sales figures for November, with traders paying close attention to any improvement in Australia’s struggling housing market.
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TAGS: Pound Australian Dollar Forecasts