The Australian Dollar to Pound Sterling (AUD/GBP) exchange rate was given a leg up during the Australasian session, thanks to a better-than-expected batch of Australian employment figures.
The legitimacy of Australia’s employment stats may have been called into question in recent months but the news that the nation’s unemployment rate held at 6.2% thanks to a 33,400 surge in full time positions did inspire AUD gains.
The nation’s participation rate increased from 64.5% to 64.6%.
In reference to the improvement in the labour sector, industry expert Michael Blythe commented; ‘Just about every leading indicator suggests that we’re at a turning point around now. But clearly there will be some suspicion about the reliability of these numbers for a while as we all digest recent changes.’
The Australian Dollar had previously fallen to a four-year low against the US Dollar as iron ore and crude oil prices declined. While the South Pacific asset did recover some losses against the Pound, the AUD/USD exchange rate was still struggling as the European session began.
In the view of one foreign exchange strategist; ‘The AUD was smoked last night. AUD/USD is far and away the weakest major currency pair, with the New Zealand Dollar gasping to keep up with a loss of 1.13%.’
However, the Australian Dollar to Pound Sterling (AUD/GBP) exchange rate was able to extend gains over the course of the day thanks to weakness in UK stats.
The Halifax House Price report revealed the first month-on-month decline in UK house prices since June of this year.
Halifax economist Martin Ellis said of the report; ‘Activity continues to decline. The economy is, however, continuing to grow at a healthy pace and employment is still rising. These factors should support housing demand over the coming months.’
Separate UK reports showed a slowing in the annual pace of Industrial and Manufacturing Production.
Pound Sterling losses were compounded after the Bank of England delivered its interest rate decision following a two-day policy meeting.
As expected, the central bank left the benchmark interest rate at a record low of 0.5%.
We won’t know how the members of the Monetary Policy Committee voted until the minutes from the meeting are published in a couple of weeks, so for now the dovish decision to leave policy unaltered was enough to push the Pound lower.
Overnight AUD/GBP fluctuations could follow the publication of the Reserve Bank of Australia’s Monetary Policy Statement.
The Australian Dollar to Pound Sterling (AUD/GBP) exchange rate is currently trending in the region of 0.8587.
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