Pound To Australian Dollar Exchange Rate: Will GBP/AUD Rise On Today's UK GDP

Published: 20 Oct 2017 21:24 Currency Markets Forex

Pound Sterling to Australian Dollar exchange rate forecast

The Pound (GBP) exchange rates were able to advance briefly against some peers after positive post-Brexit comments

  • The Pound to Australian Dollar exchange rate today (30/09/16): +0.2pct higher on the day's opening levels at 1.70285.
  • The Australian Dollar to Pound exchange rate today: 0.58725.
  • The US Dollar to Australian Dollar exchange rate today (30/09/16): +0.29pct at 1.31465.

GBP/AUD made consistent attempts to climb throughout Thursday’s European session, but despite slipping risk-sentiment in global markets, Sterling lacked the appeal to sustain any advances.

GBP sentiment was briefly bolstered in the early-afternoon by optimistic comments on post-Brexit trade from UK Trade Secretary Liam Fox. However, as his speech contained no plans and little besides speculation, Sterling ultimately failed to hold its ground.

While the Australian Dollar was initially boosted by rising oil costs after an OPEC decision, it has since fallen due to gross profit-taking by AUD investors.

The Pound has not been faring well elsewhere, having been damaged by speculation that ‘Brexit’ may not occur in the UK’s favour.

The Pound (GBP) exchange rates may be able to establish a more solid advance against currency rivals such as the Australian Dollar today if predictions prove accurate

GBPAUD rose up from its worst levels and attempted to advance on Wednesday afternoon, as risk-sentiment dimmed and investors adjusted their positions on Sterling’s lows.

Sterling could see a more solid recovery if Thursday’s UK August consumer credit or mortgage approvals figures impress.

For the Pound, the present tight trending against the Australian Dollar has largely been brought about by uncertainty about how the UK will fare after ‘Brexit’ finally takes place. With this in mind, however, the near-term may be more positive, as Thursday morning’s UK lending data for August is forecast to print positively.

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Suggestions from the Bank of England’s Minouche Shafik that more policy easing is needed recently weakened Pound Sterling exchange rates, causing the GBP/AUD currency pair to dip.

While a World Trade Organisation (WTO) report suggesting there would be no UK recession in 2017 slowed the decline, Pound Sterling to Australian Dollar exchange rates continue to fall.

The latest source of weakness has stemmed from comments from the Bank of England’s (BoE) Minouche Shafik, who stated that;

‘It seems likely to me that further monetary stimulus will be required at some point in order to help ensure that a slowdown in economic activity doesn’t turn into something more pernicious.’
GBP to AUD exchange rate chart

Latest Pound/Australian Dollar Exchange Rates

On Thursday the Pound to British Pound exchange rate (GBP/GBP) converts at 1

The pound conversion rate (against pound) is quoted at 1 GBP/GBP.

The GBP to USD exchange rate converts at 1.263 today.

The GBP to NZD exchange rate converts at 2.111 today.

Please note: the FX rates above, updated 28th Mar 2024, will have a commission applied by your typical high street bank. Currency brokers specialise in these type of foreign currency transactions and can save you up to 5% on international payments compared to the banks.

Although GBP/AUD has declined, gains for the Australian Dollar (AUD) are beginning to slow as the global hunt for yield following the US presidential debate loses momentum.

The fact that Hillary Clinton was perceived to have dominated the first US presidential election debate gave markets the confidence to turn to high-yield assets recently, boosting the Australian Dollar (AUD).

This rally is beginning to run out of steam, with the AUD/GBP exchange rate making smaller - but still noticeable - gains, as traders return to the US Dollar after a strong consumer confidence score.

Chinese consumer confidence surveys are providing the AUD with some support, with the Westpac-MNI consumer sentiment index for September rising from 111.5 to 115.2.

Australian Dollar to Pound Sterling exchange rate chart

While NAB expects profit-taking on short positions could temporarily boost Pound Sterling, it continues to hold a negative outlook.

Net short positions on the British Pound have fallen from their record levels, but the still high volume of short positioning could see GBP rise in the short-term as traders take profit at the end of the third quarter.

However, NAB notes that;

‘Looking ahead, however, we retain our overall negative stance on the British Pound. Fears of an immediate recession have largely evaporated, but there’s little doubt that tough times lie ahead.’

From a data point of view, tomorrow’s consumer credit and mortgage approvals figures for August could further move GBP.

Are Fed Rate Hike Expectations to Weigh on Australian Dollar?

The current atmosphere of risk-appetite could find itself waning, with AUD falling as traders are drawn back towards the USD later today.

This is becauseFederal Reserve Chair Janet Yellen is due to testify before a House Panel, while later on Federal Reserve Presidents James Bullard, Charles Evans and Loretta Mester are making various public appearances.

It is therefore highly likely that the markets will find something in the content of their remarks to adjust expectations of a December rate hike; how the Australian Dollar responds to this depends upon whether bets of tighter US policy go up or down.

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