The Pound Australian Dollar (GBP/AUD) exchange rate is mixed this morning as the ‘Aussie’ finds extra support from the general risk-on mood.
The GBP/AUD pairing is trading at around AU$1.7941 as positive retail sales data from the UK helps to limit any of Sterling’s losses.
Pound (GBP) Supported by UK Retail Sales Data
Though the Pound is mixed this morning against the Australian Dollar due to a global risk-on mood, GBP is able to limit its losses following a range of positive data from the UK this morning.
Retail sales in the UK jumped up to 5.4% in March, rising 2.2% from February’s data as the UK began to ease lockdown restrictions.
Paul Dales, chief UK economist at Capital Economics, commented on the growth saying:
‘March’s strong rise in retail sales showed that the economy made a fair bit of progress even before non-essential retailers reopened in April.’
‘Sales will probably leap further in April when non-essential shops reopened… Overall, we think a surge in retail sales in April will mark the start of a rapid economic recovery that may mean the extra tax hikes and spending cuts that most fear may not materialise.’
More so, the release of flash PMI data from the UK also helped to limit any losses in the currency.
Business activity in the UK is thought to have grown to 60.1, the fastest rate since 2013. The manufacturing PMI also edged up to 60.7.
As reported by Chris Williamson, chief business economist at IHS Markit:
‘Business activity should continue to grow strongly in May and June as virus restrictions are eased further, setting the scene for a bumper second quarter for the economy.’
‘There’s also good news for the job market. With optimism about the year ahead continuing to run close to March’s all-time high, firms have been encouraged firms to take on extra staff at a rate not seen for over three and a half years.’
Australian Dollar (AUD) Bolstered by Global Risk-On Mood
The Australian Dollar had found itself higher against many of its major rivals this morning as positive flash PMI data from Australia and a global risk-on mood helped to bolster the ‘Aussie.’
As reported by IHS Markit who compile the survey:
‘Private sector growth in Australia gathered considerable momentum in April. Survey participants noted that the easing of COVID-19 restrictions boosted consumer confidence and supported demand. Indeed, new work intakes and output expanded at the sharpest rates since data collection started in May 2016.’
More so, the Australia Dollar is being supported from a global risk-on mood as investors move towards risk-correlated currencies like the Australian Dollar and shun the safe-haven US Dollar.
Pound Australian Dollar Exchange Rate Outlook: Australian Inflation in Focus
Heading into next week, Australian Dollar traders will be looking towards inflation data for Q1 from Australia at the start of the week.
The inflation data could give an insight into how Australia’s economy is performing as the country recovers from the worst of the coronavirus pandemic.
For Pound investors, in absence of any notable data the exchange rates will instead be driven by any further coronavirus developments as investors keep an eye on the Indian mutation on the coronavirus.