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GBP/AUD Falls despite RBA Cutting Interest Rates

Last week’s high: $1.8257

Last week’s low: $1.8125

 

Australian Dollar Fluctuates as RBA Cuts Interest Rate

The Pound began the week relatively subdued as UK political news was overshadowed by US President Donald Trump’s state visit.

Meanwhile the Australian Dollar remained down following Sunday’s printing of the AiG performance of management index figures for May, which eased to 52.7 against April’s 54.8.

US-China trade tensions also weighed heavily on the ‘Aussie’, with no signs of abating as China threatened to increase tariffs on rare earth minerals, crucial to the functioning of the US economy.

Sterling was weakened following Tuesday’s publication of the Markit construction figures for May, which fell into contraction at 48.6 – despite the forecast 50.5 stasis.

Tuesday also saw the Australian Dollar plagued by disappointing economic data, while the Reserve Bank of Australia cut interest rates to 1.25%, as had been widely expected.

As the week closed, the Pound fell against the Australian Dollar as uncertainty surrounding both Brexit and the future leader of the Conservative Party weighed heavily on UK market sentiment in Sterling.

 

AUD Outlook: US-China Trade War to Remain in Focus

Sterling traders are awaiting this morning’s significant slew of UK data, which includes the latest GDP figures as well as manufacturing and industrial production.

Following that, tomorrow’s ILO unemployment figures for April, which are expected to increase, may also provide GBP/AUD with some direction.

These will be followed by the UK average earnings excluding bonus figures for April.

The Pound Australian (GBP/AUD) exchange rate will be driven by political developments, with US-China trade tensions remaining in focus, while Sterling traders will be noting any movements regarding Brexit or with the future leader of the Conservative Party.

 

Key Events

10th June

AUD Queen’s Birthday (Bank Holiday)

09:30 UK GDP (Apr)

09:30 UK Industrial Production (Apr) (MoM)

09:30 Manufacturing Production (Apr) (YoY)

11th June

09:30 UK ILO Unemployment Rate (Apr)

09:30 UK Average Earnings Excluding Bonus (Apr)

12th June

00:25 RBA’s Kent speech

01:30 AUD Westpac Consumer Confidence (Jun)

13th June

02:30 AUD Unemployment Rate (May)

02:30 AUD Employment Change (May)

 

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To keep up to date with the Australian Dollar, visit the AUD blog in our Currency News section.

 

Alastair Archbold
Currency Trader
T: 01442 892 062

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