Pound to Australian Dollar Exchange Rate Climbs despite Gloomy UK Growth Stats
Investors have been buying the Pound to Australian Dollar (GBP/AUD) exchange rate this week, despite a lack of particularly supportive news for the Pound (GBP). The Australian Dollar (AUD) is unappealing amid recovering rivals and Australian coronavirus concerns.
GBP/AUD has already recovered most of last week’s losses so far this week. Last week saw GBP/AUD slide from 1.8327 to 1.8237 throughout the week, almost a cent.
At the time of writing, GBP/AUD is edging higher and trends in the region of 1.8319 – just below last week’s opening levels.
GBP/AUD is also drawing closer to last week’s high of 1.8387, which was the pair’s best level in almost two months since June.
Pound (GBP) Exchange Rates Steady despite Gloomy UK Economic Outlook
The Pound has been fairly resilient today, despite this week’s UK data being fairly gloomy so far.
Yesterday’s UK job market report showed that Britain’s jobs were being hit hard by the coronavirus pandemic, and figures are only expected to worsen further towards the end of the year.
Today’s key UK data follows with a similar story. While the key Q2 Gross Domestic Product (GDP) growth rate report was slightly better than expected in some key prints, it was not enough to improve Britain’s outlook.
The data also indicated that Britain was hit harder by the coronavirus pandemic in Q2 than most other major economies.
While the UK government is attempting to boost economic activity again, fears of a ‘second wave’ of infections are dampening the British currency’s appeal.
Australian Dollar (AUD) Exchange Rates Pressured as Australia’s Coronavirus Situation Worsens
The Australian Dollar’s (AUD) appeal as a risk-correlated currency benefitting from coronavirus hopes has been unravelling in recent weeks.
With the global coronavirus outlook turning out worse than many economists had initially predicted, investors have been hesitant to take risks.
The Australian Dollar, which gained from months of risk-on movement and recovery hopes, is coming under fresh pressure lately.
Not only are global coronavirus ‘second wave’ fears worsening, but Australia itself is seeing more damage from the pandemic.
Australia’s State of Victoria is seeing extended lockdown due to infections and deaths in the region. Now, rising cases in New South Wales are also causing market concern.
NSW Premier Gladys Berejiklian escalated concerns about the rising infections, urging citizens to wear masks. The comments caused concerns that NSW could also see fresh lockdown.
Pound to Australian Dollar (GBP/AUD) Exchange Rate Awaits Australian Job Market Report
Today’s Australian wage stats were underwhelming, keeping further pressure on the Australian Dollar. However, the Australian Dollar is likely to react even more to tomorrow’s Australian job market report.
Thursday’s Asian session will see the publication of Australia’s July job market stats. As the Reserve Bank of Australia (RBA) continues to focus on the health of Australian jobs amid the coronavirus pandemic, the data could be highly influential.
If Australian jobs were harder hit by the coronavirus pandemic in July than expected, the Australian Dollar could face fresh pressure.
With this week’s UK data all published, Australian news could be more likely to drive GBP/AUD towards the end of the week. A Friday speech from RBA Governor Philip Lowe could also influence the ‘Aussie’.
Of course, any notable developments in Australia’s coronavirus situation could also drive the Pound to Australian Dollar (GBP/AUD) exchange rate.
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