Yesterday’s high: AU$1.6535
Yesterday’s low: AU$1.6450
Rising Geopolitical Tensions Damage AUD Sentiment
Rising global tensions between the US and North Korea continued to weigh on the Australian Dollar overnight on Wednesday as the war of words escalated again, with the US warning that any military aggression by Pyongyang would be the ‘end of its regime’.
AUD was also undermined by a fall in Chinese iron ore futures last night, with investors bracing for a potential dip in prices when spot markets reopen later today.
Meanwhile the Pound was strengthened on Wednesday as the rise in geopolitical tensions saw investors flock to the relative safety of Sterling, despite the uncertainty of ongoing Brexit negotiations.
AUD Outlook: UK Trade Figures to Pressure Sterling?
The GBP/AUD exchange rate may stumble near the start of the European session this morning as the UK’s latest trade balance report is expected to show that Britain’s trade deficit widened again in June.
The Pound may be further weakened by today’s Industrial Production data, with economists forecasting that June’s data will reveal that factory output slumped for the entirety of the second quarter.
Meanwhile a quiet end to the week in terms of data will likely leave the Australian Dollar exposed to further external influences over the next couple of days, with further tensions on the Korean peninsula possibly leading to additional losses.
09:30 UK Trade Balance June
09:30 UK Industrial Production June
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