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UK PMIs in Focus for This Week’s GBP/AUD Movement

Last week’s high: AU$1.7946

Last week’s low: AU$1.7741

GBP/AUD Drops to Two-Week Low on Slow Brexit Progress

The GBP/AUD exchange rate rose early last week, but failed to maintain these gains and finished the week down.

Brexit concerns were the main reason for Pound losses; EU leaders and Bank of England (BoE) officials warned that faster and clearer progress in Brexit talks was urgently needed.

Australian Dollar movement was aided last week by a US Dollar decline and signs of a potential de-escalation in the US-China trade war.

AUD Outlook: Will GBP/AUD Rally on UK Services PMI?

For Pound traders, this week’s main data will be PMI readings for the manufacturing, construction and services sectors.

The services reading is the most important of the three, as it measures changes to the UK’s largest economic sector. Slower manufacturing and construction sector activity is forecast, but the Pound could still rise sharply if the services PMI rises as expected.

This week’s Australian data releases include an RBA interest rate decision and, later, services and trade balance stats.

The RBA meeting might cause AUD losses if it suggests that an interest rate hike is still unlikely this year.

Wednesday’s AUD/GBP movement is less predictable – a trade surplus expansion is forecast but the Australian services sector is conversely expected to show slowing activity.

 

Key Events

2nd July

09:30 UK Manufacturing PMI

3rd July

05:30 Reserve Bank of Australia (RBA) Interest Rate Decision

09:30 UK Construction PMI

4th July

00:30 Australian AIG Services Index

02:30 Australian Balance of Trade

09:30 UK Services PMI

 

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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

aja@fcgworld.co.uk

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