The Pound to Australian Dollar (GBP/AUD) exchange rate has been heading higher during today’s session after the Pound was supported by GDP data from the UK.
At the time of writing the GBP/AUD pairing are trading at around AU$1.810 as the Australian Dollar clings to modest gains against the US Dollar.
Pound (GBP) Supported by Better-Than-Expected UK GDP
The Pound has been steadily rising against many of its counterparts today as the final Q4 GDP reading from the UK was revised higher to 1.3%.
The small recovery at the end of 2020 confirmed the UK avoided a double-dip recession and pushed Sterling higher.
Data from the Office of National Statistics (ONS) shows that the UK economy shrank by 9.8% as a whole over 2020, slightly lower that the initial figure of 9.9%.
Ruth Gregory, Senior UK Economist at Capital Economics commented on the revised figures saying:
‘The upward revision to GDP in the second half of 2020 means the economy does not have quite as far to recover from the COVID-19 crisis. And Q4’s high saving rate leaves plenty of scope for a rapid rebound in 2021, spurred and financed by consumers.’
Sterling continues to find support in the UK’s lockdown easing, with the next date of April 12th fast approaching, investors remain increasingly optimistic over the UK’s economic recovery in the coming months.
Australian Dollar (AUD) Supported by Pullback of US Dollar (USD)
The Australian Dollar is being supported this morning due to a pullback in the US Dollar as investors await a key speech from President Joe Biden regarding infrastructure spending.
The pullback has allowed the Australian Dollar to capitalise and head higher, however the US Dollar losses have been limited as optimism surrounding the USA’s economic recovery from coronavirus is likely to see USD exchange rates strengthen again.
The Australian Dollar was also supported by some positive PMI figures from China overnight.
The Australian Dollar has found gains limited despite the announcement that the nation had missed its coronavirus vaccine delivery goal by 85%.
It comes as Brisbane enters a short, sharp lockdown to help combat an outbreak of the virus in the city.
Australia’s Health Minister defended Australia’s vaccination rollout today after stating that a record 72,826 vaccinations had been given in the past day, he went on to say:
‘That’s showing that the national vaccination programme is accelerating exactly as intended in the manner that was intended.’
670,000 people in the country have received a dose of a coronavirus vaccine, much lower than the 4 million people they had expected to vaccinate by April.
GBP/AUD Exchange Rate Outlook: Manufacturing PMIs in Focus
Overnight, Australia will see the release of the latest manufacturing PMI which is expected to rise 0.1 points, a modest growth which could add support to the currency.
The UK’s own manufacturing PMI is released tomorrow morning, a growth of almost 3 points will also push GBP higher.
The GBP/AUD exchange rate will also be driven by the global market mood, if the US Dollar recovers following Joe Biden’s speech then the Australian Dollar could head lower.