Although the Pound was boosted against peers like the Euro following the publication of a strong UK Nationwide house price report, the British asset retained earlier losses against both the Australian and New Zealand Dollars.
The Australian Dollar was trading in the region of 0.5933 against the British Pound as of 10:20 am GMT
During Australasian trading Sterling slipped against its South Pacific rivals as Australian building approvals were shown to have surged in September.
Approvals leapt by 14.4 per cent month-on-month, the most significant increase for more than a year.
The 33.3 per cent year-on-year jump was the biggest for over a decade.
This result compliments the new home sales data released yesterday, which showed an increase of 6.4 per cent in September.
According to currency strategist Greg Gibbs; ‘This is a further indication that the RBA has cut rates sufficiently to engender a strong housing market, and thus any further cuts may be of little value and in fact threaten longer-term financial stability by over-stimulating the housing market.’
Concerns that the Reserve Bank of Australia intends to issue an additional rate cut in the near future have weighed on the ‘Aussie’, so this result helped the South Pacific asset climb.
The Australian Dollar advanced on the Pound and recovered earlier losses against its US counterpart.
A separate report also showed that domestic housing credit increased by 0.4 per cent in September MoM.
Some industry experts, like Sydney-based Paul Brennan, believe that the RBA will see the benefit of a strong housing sector. Brennan commented; ‘It shows that higher prices and lower interest rates are sponsoring an improvement in construction. If this is the kick-start to a sustained supply response, then it will help keep a lid on house price growth while helping with the rebalancing of the economy toward domestic demand.’
Before the weekend further GBP/AUD movement could occur in response to the Australian AiG performance of manufacturing index and tomorrow’s UK manufacturing PMI.
Furthermore, as China is Australia’s largest trading partner, Chinese manufacturing PMI is also likely to have a notable impact on the ‘Aussie’.
The Australian Dollar to Pound Sterling (AUD/GBP) exchange rate hit a high of 0.5941
In other currency news, the GBP/NZD pairing softened following the Reserve Bank of New Zealand’s rate decision.
While the central bank opted to hold the benchmark rate at 2.5 per cent, as expected by economists, it also asserted that the ‘Kiwi’s persistent strength could relieve inflationary concerns and postpone a rate increase.
RBNZ Governor Graeme Wheeler asserted; ‘Sustained strength in the exchange rate that leads to lower inflationary pressures would provide the bank with greater flexibility as to the timing and magnitude of future increases in the OCR.’
As Wheeler refrained from expressing concern over the New Zealand Dollar’s strength the ‘Kiwi’ advanced on the Pound and US Dollar before the European session began.
Current Australian Dollar Exchange (AUD) Rates
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The Australian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9500 >
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6941 >
The Australian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5933 >
The Australian Dollar/ New Zealand Dollar Exchange Rate is currently in the region of: 1.1513 >
The US Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0517 <
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4408 <
The Pound Sterling /Australian Dollar Exchange Rate is currently in the region of: 1.6850 <
The New Zealand Dollar/Australian Dollar Exchange Rate is currently in the region of: 0.8683 <
Correct as of 10:20 am GMT
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