Last week’s high: AU$1.8210
Last week’s low: AU$1.7903
Sturdy GDP Data Fails to Lift Pound against the Australian Dollar
The Pound spent last week recovering many of its losses against the Australian Dollar but came under pressure on Friday, losing -0.5% over the day.
The loss came despite UK Q2 GDP figures coming in on-forecast, showing a 0.4% rise on the quarter. The annual rate, however, came in below expectations of 1.3%, instead printing at 1.2%.
Sterling was unable to benefit, however, as some accompanying business investment figures showed a quarter-on-quarter drop of -0.7%, far below the consensus expectations of a 0.5% rise.
Meanwhile AUD has come under pressure on concerns that the iron ore market could be oversupplied for the next 2-3 years. Any depression in the price of Australia’s main export commodity is likely to have a downside effect on the Australian Dollar.
AUD Outlook: RBA Interest Rate Decision in Focus
Next week will see the Reserve Bank of Australia (RBA) meet to decide whether to change interest rates.
Rates have been set at an all-time low of 1.5% since August 2016 and economists don’t foresee any change next week, with a poll commissioned by Reuters finding a consensus agree that rates will not change until at least the end of 2019.
Coming on Thursday, next week’s Australian August trade balance is expected to see the surplus shrink from AU$1.551bn to AU$1.4bn.
This AUD negative is likely to be offset by some increased retail sales on Friday, however, with monthly growth for August set to rise from zero to 0.3%.
04:30 RBA Rate Statement and Interest Rate Decision
01:30 Building Permits (Jul)
00:30 Trade Balance (Aug)
00:30 Retail Sales s.a. (Aug)
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