December 23, 2021 - Written by John Cameron
STORY LINK Pound Australian Dollar Exchange Rate News: GBP/AUD Directionless Despite Omicron Fears Dwindling
GBP/AUD Muted in Spite of Omicron Concerns Fading
The Pound to Australian Dollar (GBP/AUD) exchange rate is trading in a narrow range at the beginning of today’s session despite anxieties surrounding the Omicron strain dwindling.
At the time of writing, the GBP/AUD exchange rate is trading at approximately AU$1.8502 with market movement stunted as Christmas festivities loom.
Australian Dollar (AUD) Muted Despite Risk-On Mood
The Australian Dollar (AUD) is trading relatively flat against the Pound (GBP) this morning despite the risk-on sentiment.
The 'Aussie’ is being favoured slightly against its other peers as the Omicron variant is believed to be less hazardous than initially thought.
Moreover, the scientific evidence shows that the vaccines currently being delivered are considered to be more effective than first thought, causing optimism for a stronger economic recovery in the new year.
On Wednesday, Australian Prime Minister, Scott Morrison, said:
‘We are taking Omicron very seriously, as you would expect us to.
‘But we are confident that we will be able to continue to ensure we can face down the most recent challenge.’
Morrison also said that the ‘[200,000 figure] is not a scenario that is envisaged any way shape or form…’ and is a worst case situation which is unlikely to come into fruition.
This has further boosted a much-needed positive approach for 2022 following the scares that the recently-identified coronavirus strain had created.
Pound (GBP) Trading in Narrow Range Despite Omicron Optimism
Meanwhile, the Pound (GBP) is mixed against the Australian Dollar (AUD) this morning in spite of UK data suggesting that the Omicron variant is less likely to cause hospitalisation than the Delta variant.
According to new UK data, Omicron appears to be milder than previous strains, with a 20%-25% decreased likelihood of being admitted to hospital.
This new information has buoyed the travel and hospitality sectors across the UK as investors favour the leading companies within these fields due to fading Omicron fears.
Additionally, the UK government has not said that there will not be any more restrictions before Christmas which has further buoyed Sterling.
However, this positive information has been dampened by various scientists urging the public to remain vigilant.
Professor Neil Ferguson, SAGE scientist, said:
‘The challenge is, if there's enough of them [hospitalised individuals with coronavirus] it still poses quite a challenge to the NHS. We're not talking about anything like what we saw last year with over-flowing intensive care units and ventilator beds.’
Chris Hopson, chief executive of NHS Provider, has reinforced Ferguson’s warnings by reiterating that although this data is positive, it is not conclusive, thus everyone should continue to be cautious.
GBP/AUD Exchange Rate Forecast: Omicron to Continue Dominating Market Movement
Looking ahead, the Pound Australian Dollar (GBP/AUD) exchange rate may remain vulnerable to market movement as scientific guidance surrounding the Omicron strain continues to evolve.
The UK government has said there will be no more restrictions implemented before Christmas. But the announcement of post-Christmas restrictions in England remains a clear risk for the Pound.
As we head towards Christmas, there is an absence of data scheduled for released throughout the rest of this week’s session which is likely limit movement and the ‘Aussie’s appeal.
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