The Pound to Australian Dollar (GBP/AUD) exchange rate has rebounded from its worst levels in a month, and so far this week the pair appears to be avoiding new losses.
Investors bought the Pound from weekly lows as some investors saw last week’s selloff as overblown.
This week so far, investors are slightly more hesitant to take risks as well. The risk and trade-correlated Australian Dollar has been hit by lower demand for commodities, including oil, since markets opened.
Last Week: Sterling’s Rally Comes to an End
After months of highly impressive performance, last week made it clear that the Pound’s bullish run had finally run out of steam.
Sterling continued to be sold from recent highs on profit-taking. Then, later in the week, fresh uncertainties over the upcoming Scottish elections weighed on the Pound as well.
This is because there are concerns that Scottish elections could see the nation edge closer to independence. If this likelihood rises, the uncertainty will weigh further on the Pound.
The Australian Dollar benefitted from stronger market risk-sentiment last week as well.
Three Things to Watch For This Week
- Reserve Bank of Australia (RBA) Meeting Minutes
The RBA’s latest meeting minutes report will be published tomorrow. It will give investors a better idea of if the RBA is likely to become less dovish any time soon.
- Retail Sales Results
Australian retail sales data is due on Wednesday, with UK retail stats expected on Friday. These data will show markets how Australian and UK consumer activity has been holding up amid the latest months of the coronavirus pandemic.
- PMI Projections
A slew of April PMI projections for both Australia and the UK will be published on Friday. If there has been any unexpected shift in economic activity this month, this data is likely to be the first to show it.
With slews of UK and Australian data due this week, the Pound to Australian Dollar exchange rate could be influenced by upcoming data, coronavirus news, or shifts in global market sentiment.