Last week’s high: AU$1.7937
Last week’s low: AU$1.7705
Australian Dollar Driven by Trade War Fears
The Pound Australian Dollar exchange rate was marked by volatility last week, with both trade and Brexit uncertainty prompting major swings in the pairing.
For the Australian Dollar a sharp escalation in trade tensions between the US and China dogged the currency throughout the middle of the week, with observers fearing the countries were nearing the point of no return
However these trade fears began to ease towards the end of the week, allowing for the ‘Aussie’ to rally sharply.
In the meantime, the Pound was rocked by political uncertainty from the get go, with initial losses in the currency being driven by the resignations of Cabinet members Boris Johnson and David Davis.
While markets were calmed as Theresa May avoided a leadership contest, Sterling was only given a brief moment to catch its breath.
The Pound closed the session on the back foot as the publication of May’s Brexit blueprint saw President Trump suggest her plans would ‘kill off’ any chances of a free trade deal with the US.
AUD Outlook: Rise in UK Inflation, Wage Growth to Bolster BoE Rate Expectations?
Looking ahead, it’s set to be a busy session in terms of data this week, potentially driving significant movement in the GBP/AUD exchange rate.
From the UK there will be the release of both inflation and wage growth figures, with the Pound likely to jump should a rise in either stat help to bolster hopes of the Bank of England (BoE) targeting a rate hike next month.
Meanwhile Australia will also publish its latest labour report this week, with the ‘Aussie’ potentially finding support if full time employment is shown to have rebounded in June.
01:30 AU RBA Minutes
09:30 UK Unemployment Rate (May)
09:30 UK Wage Growth (May)
09:30 UK Inflation (Jun)
02:30 AU Unemployment Rate (Jun)
02:30 AU Employment Change (Jun)
09:30 UK Retail Sales (Jun)
09:30 UK Public Sector Borrowing (Jun)
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