July 18, 2019 - Written by John Cameron
STORY LINK Pound Australian Dollar (GBP/AUD) Exchange Rate Steadies as Australian Employment Change Figures Fall
GBP/AUD Exchange Rate Flat as Australian Unemployment Holds Steady
The Pound Australian Dollar (GBP/AUD) exchange rate steadied today, leaving the pairing fluctuating around AU$1.774.
The Australian Dollar (AUD) exchange rate is flat against the Pound (GBP) following the publication of the Australian employment change figures for June.
These came in worse-than-expected, falling from 45.3k to 0.5k.
Australia’s unemployment rate figures, meanwhile, held steady at 5.2%.
Shane Oliver, Head of Investment Strategy at AMP Capital, commented:
‘While the RBA is likely to be on hold for the next few months while it 'monitor[s] developments in the labour market' and today’s job report was not dramatic enough to change that either way, we remain of the view that it will still have to cut rates further later this year ultimately taking the cash rate down to 0.5 per cent early next year.’
GBP/AUD Exchange Rate Rangebound as UK Retail Sales Improve in June
Sterling benefited from today’s printing of the UK retail sales figures for June.
On a year-on-year basis these beat forecasts by rising 3.8%, while monthly figures increased above the consensus -0.3% to 1%.
Rhian Murphy, a Statistician at the Office of National Statistics (ONS), said:
‘Retail as a whole saw a return to growth in the month of June, mainly due to growth in non-food stores with increased sales in second-hand goods, including charity shops and antiques.’
Following on from increasing wage figures, record low unemployment and stable inflation, these figures have given UK markets reason for optimism, despite ongoing Brexit uncertainties.
The Pound, meanwhile, has been held back by continuing fears over Brexit ahead of a ballot vote in the House of Commons today, which will determine whether the future Prime Minister can suspend Parliament in a bid to push through a no-deal with the European Union.
The Pound could begin to sink today if the vote fails to pass through, further heightening no-deal Brexit fears between the EU and the UK.
GBP/AUD Forecast: Sterling Could Sink on Heightened No-Deal Fears
Pound traders will be looking ahead to tomorrow’s UK Public Sector Net Borrowing figures for June.
However, as these are expected to decrease, this could prove Pound-negative.
As the Australian economy is heavily reliant on peace between the US and China, with China being Australia’s closest trading partner, any signs of a flare up between the two superpowers could begin to weigh on the ‘Aussie’.
The GBP/AUD exchange rate will remain sensitive any signs of a hardening position on Brexit from the two Tory leadership hopefuls.
If the amendment that is aimed to prevent a no-deal being pushed through Parliament today fails, we could see the Pound fall against many of its competitors.
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TAGS: Australian Dollar Forecasts Pound Australian Dollar Forecasts