GBP/AUD Exchange Rate Strengthens amid Safe-Haven Dash
The Pound Australian Dollar (GBP/AUD) exchange rate firmed today as downbeat trade stifled the risk-sensitive ‘Aussie’.
At the time of writing the GBP/AUD exchange rate is trading at around AU$1.9017, up approximately 0.5% this morning’s opening rate.
Pound (GBP) Mixed amid Gloomy Trade
The Pound (GBP) was volatile today amid a lack of UK data, though was able to firm against its more risk-sensitive peers as cautious trade permeated global markets.
Looking ahead, UK data remains in short supply in the coming days. As the week draws to a close, the UK’s highly anticipated GDP data is due for release and is expected to be the core catalyst of movement on Friday.
GDP in November is forecast to show 0.2% growth, increasing from the UK economy’s 0.3% contraction in the previous month. Should the data print as expected, GBP may strengthen amid signs of economic expansion.
Otherwise, a lack of notable data may leave the Pound vulnerable to market sentiment in the interim. While today’s downbeat trade buoys GBP against it’s more risk sensitive peers, a shift towards upbeat trade may see Sterling slump against the Australian Dollar.
Australian Dollar (AUD) Stumbles amid Risk Aversion
The Australian Dollar (AUD) faced heavy selling pressure today as cautious trade dampened investor interest in the risky ‘Aussie’.
A lack of notable data saw AUD stumble, left vulnerable to market mood.
Coming up this week, Australia’s latest retail sales data is due out on Tuesday and is forecast to report 1.2% growth throughout November of last year. Increased signs of consumer activity may signal that Reserve Bank of Australia (RBA) could avoid interest rate cuts until later in the year.
Wednesday will see the release of the November’s CPI indicator. Economists expect to see inflation hit a four-month-low, at 4.4%. Cooling inflation may serve to confirm that the RBA has concluded its tightening cycle, shifting focus further towards when rate cuts will begin in 2024.
On Friday, the latest Chinese inflation data may spark AUD volatility due to the Australian Dollar’s status as a proxy currency for the Chinese economy. A forecast cooling in China’s annual inflation to -0.7% may cause choppy trade for the ‘Aussie’, as inflation in the highly impactful Chinese economy continues to rapidly cool.
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