Last week’s high: AU$1.8349
Last week’s low: AU$1.8050
Global Trade Concerns Smooth Way for GBP/AUD Gains
While it slipped slightly from its best levels towards the end of the week, the Pound to Australian Dollar exchange rate saw solid gains throughout last week’s trading session thanks to rising bets that the Bank of England (BoE) would hike UK interest rates in May.
BoE interest rate hike bets were just one reason behind GBP/AUD’s strong gains however. Pound investors were also pleased with strong UK jobs and retail data, as well as news that the UK and EU had finally agreed to a post-Brexit transition period.
This made it easier for Sterling to advance against the Australian Dollar, which was held back all week by risk-aversion in markets due to continued protectionist rhetoric on global trade from Donald Trump.
Concerns that stricter US trade rules could spark a trade war with China, Australia’s biggest trade partner, left the export commodity-correlated Australian Dollar unappealing throughout the week.
AUD Outlook: GBP/AUD to be Driven by UK Growth and Trade News
Of course, with investors still jittery about the possibility of rising trade tension between the US and China, it’s likely that Australian Dollar trade will continue to be largely driven by trade news and risk-sentiment over the next week.
Australia’s economic calendar will be relatively quiet though, with the only notable publications being new home sales and a private sector credit report.
As a result, UK data is more likely to influence GBP/AUD this week. Thursday’s session will be particularly influential, with British growth stats and business investment figures due for publication. Any Brexit news is also likely to influence Pound trade throughout the week.
01:00 Australian HIA New Home Sales
11:00 UK CBI Distributive Trades
01:30 Australian Private Sector Credit
09:30 UK Growth Rate
09:30 UK Business Investment
09:30 UK Mortgage Lending and Approvals
00:00 UK GfK Consumer Confidence
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