Updated 11/08/21 14:30:
The Pound Australian Dollar (GBP/AUD) exchange rate has tumbled this afternoon following the latest inflation rate figures from the US which have shown that YoY inflation remained stagnant at 5.4% as economists predict the US economy has reached its peak inflation rate.
The Australian Dollar rose as a result as the market mood strengthened and the US Dollar (USD) tumbled. A lack of economic data from the UK to support the Pound left the currency open to its own losses.
Original article continues below:
The Pound Australian Dollar (GBP/AUD) exchange rate is steadily rising this morning after the latest Westpac consumer confidence index for August tumbled to its lowest level in a year.
As Australia continues to deal with an ongoing coronavirus situation the Pound (GBP) has capitalised on the ‘Aussie’s’ weakness with the GBP/AUD pairing trading around the AU$1.8851 level.
Pound (GBP) Relies on Coronavirus Developments to Drive Movement in GBP Exchange Rates
A lack of economic data from the UK continues to limit any major gains for the Pound (GBP), as the currency relies on any further domestic coronavirus developments to drive movement today.
This morning, Heathrow airport in London reported its busiest month since the pandemic began as international travel looks to begin its recovery.
A statement released from the airport said:
‘The relaxation in rules has provided a much-needed boost to the UK travel industry, and enabled people across Britain to look forward to a more normal summer reuniting with family and friends abroad.’
‘With fully vaccinated US visitors now able to travel to the UK without the need to quarantine, the joint UK/US travel taskforce must capitalise on the UK’s world-leading vaccine rollout and reach a reciprocal agreement for fully vaccinated UK travellers.’
However the figure of 1.5 million during July of 2021 people is still down on the 7.75 million seen in the July before the pandemic began.
Australian Dollar (AUD) Weakens as Australia Consumer Confidence Sours
The Australian Dollar (AUD) has weakened against of the majors today as a disappointing Westpac consumer confidence index alongside a weakening market mood does nothing to support the ‘Aussie’.
The consumer confidence index fell to its lowest level in a year to 104.1 points as coronavirus lockdowns delay Australia’s economic recovery.
Matthew Hassan, senior economist at Westpac commented on the latest index, saying:
‘This is a significant further loss of confidence but better than might have been expected. The virus situation locally is clearly troubling, but consumers appear reasonably confident that it will come back under control, and that once it does, the economy will see a return to robust growth.’
‘Notably, sentiment is much stronger amongst those that have either been vaccinated or plan to get the jab.’
It comes as Chinese daily coronavirus cases hit a 7 month high, with investors becoming increasingly jittery over the surge in cases across the globe.
Pound Australian Dollar Exchange Rate Outlook: UK GDP Figures in Focus
Tomorrow’s session will see the release of preliminary GDP figures from the UK to drive movement in the Pound.
If GDP re-enters growth territory the Pound could see itself pushing higher across the board for much of the day.
A lack of notable economic data from Australia will see traders keeping an eye on the strength of the global market mood.