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GBP/AUD Exchange Rate Benefits From Weak Australian Inflation

Last week’s high: AU$1.7792

Last week’s low: AU$1.7655

Underwhelming Inflation Dents Australian Dollar

Weaker-than-expected second quarter consumer price index data saw the Australian Dollar slump sharply on Wednesday.

Markets were disappointed to find that inflation had failed to advance on the quarter, holding steady at a rate of 0.4%.

However, as global trade tensions showed some signs of easing this helped to boost AUD exchange rates ahead of the weekend.

Fresh worries over Brexit helped to put further pressure on the GBP/AUD exchange rate, meanwhile.

AUD Outlook: Australian Dollar Vulnerable to Weaker Trade Data

The GBP/AUD exchange rate is likely to see some significant volatility in the wake of the Bank of England (BoE) interest rate decision on Thursday.

If policymakers vote to raise interest rates the mood towards the Pound is likely to pick up markedly.

Confidence in the Australian Dollar could weaken once again in response to the latest Australian trade balance and retail sales data.

Any signs of weakness within the Australian economy would leave AUD exchange rates vulnerable to losses.


Key Events

31st July

02:30   Australia Private Sector Credit (Jun)

22:30   Australia Manufacturing PMI (Jul)

1st August

09:30   UK Manufacturing PMI (Jul)

2nd August

02:30   Australia Trade Balance (Jun)

12:00   Bank of England Rate Decision

3rd August

02:30   Australia Retail Sales (Jun)


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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 Dealer

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