The Pound to Australian Dollar (GBP/AUD) exchange rate edged higher when markets opened this morning. Investors showed optimism about Britain’s economic outlook as more shops, including pubs and hairdressers, reopened in Britain.
Concerns about Australia’s vaccine rollout are weighing on the Australian Dollar this morning. This is making it easier for GBP/AUD to advance.
Last Week: Sterling Selloff Leads to GBP/AUD Plummet
Investors sold the Pound en masse last week, as markets took profit from months of gains in the currency. After touching in monthly and yearly highs against many major rivals, including the Australian Dollar, investors sold the Pound from its best levels.
This was the primary cause of GBP/AUD losses last week.
The risk and trade-correlated Australian Dollar was able to benefit slightly from this movement due to improving market mood for risk-taking.
Global coronavirus pandemic recovery hopes, combined with dovish expectations for the US Federal Reserve, both made investors more willing to take risks.
Three Things to Watch This Week
- Slew of UK Data
Tomorrow will see the publication of the week’s UK datasets. UK trade balance, production, construction and growth results from February will all be published and could influence the Pound if they surprise.
- Australian Job Market Report
Thursday’s Australian job market report could be highly influential if it surprises investors. Weaker data could indicate that Australia’s economy is not as resilient to the pandemic as hoped, and lead to further AUD losses.
- Coronavirus Developments
As more of the UK economic reopens and Australia struggles with vaccine rollout, developments in the coronavirus pandemic will remain influential to both the Pound and Australian Dollar.
GBP/AUD Outlook
This week’s economic calendar will be a little busier, with key data due in the coming sessions. Surprising UK growth, Australian job market results or global coronavirus developments could all influence GBP/AUD.