The Australian Dollar to Pound Sterling (AUD/GBP) exchange rate has risen considerably of late, as in the midst of the commodity crash and immense economic uncertainty, speculators of the ‘Aussie’ (AUD) have been given a lifeline by the International Monetary Fund (IMF).
The Australian Dollar (AUD) has made near-universal gains recently, thanks mainly to a report by the IMF that has painted a highly positive picture for the long-term future of the Australian economy. Following the news, the ‘Aussie’ rose by 0.5% against the Canadian Dollar (AUD/CAD), the Pound Sterling (AUD/GBP) and the US Dollar (AUD/USD) and saw a greater 0.7% advance against the Euro (AUD/EUR). On the other side of the cent, the ‘Aussie’ fell by -0.6% against the New Zealand Dollar (AUD/NZD) and trended narrowly against the Chinese Yuan (AUD/CNY) during the European session.
The IMF’s World Economic Outlook report began negatively on its report for Australia, estimating that a -1% reduction in the GDP growth rate for commodity currencies would take place between 2015-17. However, the report went on to forecast that commodity exporters like the ‘Aussie’ would ultimately be better off thanks to its previous history of weathering commodity booms and droughts, and stated: ‘The findings of the study imply that the growth slowdown in the immediate aftermath of a commodity price boom most likely represents a return to a more sustainable level of output.’
The Pound Sterling (GBP) had a less optimistic day, posting a range of gains and losses as seesawing results and events unsettled investors. The Pound hit highs of more than 0.3% against the Romanian Leu (GBP/RON) and the Polish Zloty (GBP/PLN) recently, but fell by over -0.5% against the Australian Dollar (GBP/AUD), the Turkish Lira (GBP/TRY) and the South African Rand (GBP/ZAR).
The Pound was offered slight support by the rises in UK Mortgages data, but was harmed by a drop in Net Consumer Credit. In addition to this small negative, a far larger one was added when news came that the Bank of England (BoE) is being investigated by the Serious Fraud Office regarding speculation they (and other such organisations) told lenders what rate to bid at, effectively rigging the emergency auctions that took place in late 2007 when the financial crisis was beginning.
In the future, the Australian Dollar (AUD) has a number of economic publications due, although given the relative quantity and quality of the UK’s releases, it seems that the ‘Aussie’ is once again on the back foot. The Australian results are chiefly made up of Private Sector Credit for August and Building Approvals for August, although forecasts have been decidedly mixed and the later revision of the UK’s Q2 GDP is likely to overshadow any effect had by these earlier domestic Australian results.
The Australian Dollar to Pound Sterling (AUD/GBP) exchange rate was trending in the region of 0.4617 and the Pound Sterling to Australian Dollar (GBP/AUD) exchange rate was trending in the region of 2.1666 recently.
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