July 15, 2019 - Written by John Cameron
STORY LINK Pound Sterling Australian Dollar (GBP/AUD) Exchange Rate Falls as Chinese Data Buoys AUD to 10-Day High
Pound Australian Dollar (GBP/AUD) Exchange Rate Slumps despite China’s GDP Slowing to 27-Year Low
The Pound Sterling Australian Dollar (GBP/AUD) exchange rate slumped and the pairing is currently trading at an inter-bank rate of AU$1.7863.
On Monday morning data revealed that China’s GDP growth during Q2 2019 slowed to a 27-year low.
China’s economic growth slowed to 6.2% as demand both at home and abroad slumped amidst mounting US-China trade tensions.
However, stronger-than-expected Chinese economic data buoyed the risk-sensitive ‘Aussie’ to a 10-day high.
China’s industrial output rebounded in June from May’s 17-year low, while retail sales jumped by 9.8% compared to June 2018.
Commenting on the data, Commonwealth Bank of Australia Economist, Ryan Felsman, noted:
‘The upside from an Australian perspective is that China – our biggest trading partner – will continue to stimulate its economy to achieve its official annual growth target.
‘The new stimulus measures appear to be working, contributing to stronger readings in June activity data, with investment, production and retail spending all beating market expectations.’
Sterling (GBP) Falls as UK Brexit Uncertainty Looms over Housing Market
Meanwhile, Sterling remained under pressure as data showed that UK house asking prices slumped for the first time in 2019.
According to Rightmove, asking prices for British homes slipped by -0.2% in July after a rise of 0.3% in June.
However, this month’s fall contrasts with a survey of chartered surveyors which showed signs of improvement.
This underlines the uncertainty that is looming over the UK housing market, which likely weighed on the Pound.
Commenting on this morning’s data, Rightmove Director Miles Shipside noted:
‘The housing market fundamentals remain largely sound in many parts of the country, but the current political climate means that the crucial ingredient of confidence has been impaired, and that is causing some potential buyers and sellers to hesitate.’
Pound Australian Dollar Outlook: Will a Dovish RBA Weigh on AUD?
Looking ahead to Tuesday, the Australian Dollar (AUD) could slide against the Pound (GBP) following the release of the Reserve Bank of Australia’s (RBA) meeting minutes.
If the minutes reveal the bank is considering a third interest rate cut in 2019, it could cause the ‘Aussie’ to slump.
Meanwhile, the UK employment data could buoy the Pound.
If the number of people in the UK in employment jumps to a fresh record high, it could cause the Pound Australian Dollar (GBP/AUD) exchange rate to rise.
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TAGS: Pound Australian Dollar Forecasts