The GBP AUD exchange rate has flopped so far this week, owing to widespread concerns about how Brexit will actually be enacted.
Australian Dollar interest has been tempered by domestic data, which has exceeded forecasts both negatively and positively in recent days.
Pound Sterling Interest Drops Off after PM May Fails to Reassure on Brexit Designs
The Pound Australian Dollar exchange rate has stumbled in the present week so far, with negative developments over the weekend continuing to cast a cloud over Pound demand.
For the Australian Dollar, Sunday and Monday brought supportive data in the form of December’s AiG construction index, as well as November’s building permits.
This rising support was dented somewhat by November’s retail sales, however, which fell from 0.5% to 0.2% on the month.
Pound Sterling Australian Dollar Exchange Rate Predictions: Supreme Court Announcement could Calm Turbulent GBP Trading
The next big announcement to come out of the UK is expected to be the Supreme Court’s verdict on the Government’s Article 50 appeal, at some point in January.
The appeal was made in December and saw the Government attempt to take back control of triggering Article 50 without any Parliamentary vote beforehand.
Given the present conditions, a loss in the appeal could boost GBP demand, as a Parliamentary debate would see the tone of Brexit negotiations laid out, providing clarity, while the threat of a backbench rebellion could force the government to focus on protecting single market access.
If the Government wins back control, however, then the Pound could hit fresh lows for 2017, as any sign of transparency on Brexit is likely to go out the window and odds of a ‘Hard Brexit’ will increase.
Australian Dollar Future Forecast: Iron Ore Price Drop could see Trouble Ahead for Australian Exporters
The price of iron ore has been in focus by commodities experts recently and the future does not look too bright for the key Australian export at present.
By all accounts, recent rallies in the commodity’s cost have been unexpected, which only raises the odds of a sharp downturn taking place in the near-term.
Offering his take on the situation has been Shaw and Partners Mining Analyst Peter O’Connor, who has predicted;
‘If the iron ore price starts to go down, the high performance of last year won’t be replicated this year. It could be a trainwreck for the smaller, marginal producers’.
With continued pressure coming from mass-mining companies in South America, the price of iron ore hangs in the balance, which means that any substantial devaluations are likely to have a knock-on negative effect for the Australian Dollar.
Recent Interbank Exchange Rates
At the time of writing, the Pound Australian Dollar (GBP AUD) exchange rate was trending in the region of 1.65 and the Australian Dollar Pound (AUD GBP) exchange rate was trending in the region of 0.60.