Last week’s high: A$1.8435
Last week’s low: A$1.7944
Pound Slumps as No-Deal Brexit Fears are Reignited
The Pound to Australian Dollar exchange rate fell markedly last week as Sterling was hammered by fears that a no-deal Brexit was becoming increasingly likely following the vote in the House of Commons in which MPs approved an amended EU withdrawal agreement that seeks to get rid of the loathed Irish backstop clause.
Sterling exchange rates came under more pressure at the end of the week with the release of the UK’s latest manufacturing PMI stats, which saw UK factory activity moderate at the beginning of the year.
At the same time, the Australian Dollar suffered from a fall in the Chinese Caixin manufacturing PMI, which slumped into contraction territory, dragging down the ‘Aussie’ with it.
AUD Outlook: BoE and RBA in Spotlight but will Brexit cause further Uncertainty?
Looking ahead, discounting any potential Brexit developments, movement in the GBP/AUD exchange rate is likely to driven by the Bank of England’s (BoE) interest rate meeting on Thursday
Before then, we’ll see plenty of UK related economic data, in the form of services and construction PMIs, as well as house prices and retail sales
There is also a central bank meeting in Australia scheduled for Tuesday, although investors are not expecting to see any changes to rates at this point.
As in recent weeks, although much important data is scheduled to be released, the GBP/AUD exchange rate is likely to be driven by developments in Brexit negotiations between the Uk and EU, as well as shifts in risk sentiment, primarily driven by US-China trade talks.
00:30 AU Building Permits (Dec)
09:30 UK Construction PMI (Jan)
00:01 UK BRC Retail Sales (Jan)
09:30 UK Services PMI (Jan)
15:30 AU RBA Interest rate Decision
08:30 UK Halifax House Price Index (Jan)
12:00 UK BoE Rate Decision
00:30 AU RBA Monetary Policy Statement
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Foreign Exchange Manager