The Pound Australian Dollar (GBP/AUD) exchange rate had edged higher since markets opened this morning as markets begin to digest the latest Federal Reserve commentary and hawkish stance.
At the time of writing the GBP/AUD pairing are trending around the AU$1.5860 level as preliminary retail sales from Australia miss forecasts.
Pound (GBP) Edges Higher on UK Economic Optimism
The Pound has seen itself edging higher against many of its rivals this morning as investors become cautiously optimistic surrounding the UK’s recovery from coronavirus.
Despite a four-week extension to current lockdown restrictions announced at the start of last week and cases continuing to rise, hospital admissions remain low for those who have coronavirus.
Chris Hopson, chief executive of NHS Providers commented on the current hospital conditions saying:
‘It’s rising relatively slowly but it’s nowhere near anything like the kind of numbers we’ve had in previous waves.’
‘That’s why we’re continuing to say with increasing optimism that the vaccines have broken the chain between the community infections with Covid-19, and the very high level of hospitalisations that we’ve seen in previous waves.’
It comes as the end of last week saw all adults in England invited to book their coronavirus vaccine jabs, as a million appointments were booked over Friday and Saturday.
Australian Dollar (AUD) Struggles on Cautious Market Mood
The Australian Dollar continues to struggle against its counterparts this morning as preliminary retail sales figures from Australia missed forecasts.
Retail sales in Australia are thought to have risen by 0.1 percent month-over-month in May 2021, slowing from a 1.1 percent growth a month earlier and missing market consensus of 0.5 percent.
Whilst the figures show a third straight month of increase, harsher lockdown restrictions in Victoria during May are thought to have softened the pace of expansion.
More so, a cautious market mood has done nothing to support the Australian Dollar as investors head towards safe-haven currencies like the US Dollar, causing the risk-correlated ‘Aussie’ to suffer.
Pound Australian Dollar Exchange Rate Outlook: Flash Markit PMI’s in Focus
For both Pound and Australian Dollar traders, the release of the latest flash Markit PMI’s from the UK and Australia for June could drive movement in both currencies.
The PMI figures are expected to give an indication into how both economics are performing respectively, and if the sectors are growing at a sustained pace.
The global market mood will continue to drive AUD throughout the week, a more upbeat market mood could see the Australian Dollar find some much needed support.