Pound Australian dollar (GBP/AUD) exchange rate muted amid absence of data
The Pound Australian Dollar (GBP/AUD) exchange rate is trading sideways today amid an absence of both UK and Australian economic data releases.
At the time of writing the GBP/AUD exchange rate is trading at $1.9543, virtually unchanged from this morning’s opening rate.
Pound (GBP) underpinned by BoE rate cut bets
The Pound (GBP) is trading mostly flat this morning as an absence of market moving data sees the British currency struggle to find a clear direction.
However, keeping GBP exchange rates afloat this morning are current Bank of England (BoE) interest rate cut bets.
As investors continue to speculate that the BoE could deliver a less aggressive policy easing cycle than other major central banks, Sterling has enjoyed some modest support this week ahead of the Bank of England’s looming decision.
Michael Field, European Market Strategist at Morningstar, speculated:
‘The chances of a further rate cut in September are slim, according to a recent poll of economists by Reuters, with almost all surveyed believing September is coming too soon after the recent rate cut. Markets seem to be pricing in one more rate cut, which is likely to come later in the year.’
Further underpinning GBP this morning is a bout of cheery trade, which is offering the increasingly risk-sensitive pound further support.
Australian Dollar (AUD) holds steady amid risk-on flows
The Australian Dollar (AUD) is managing to hold steady against the majority of its peers this morning despite the absence of any fresh economic data.
However, offering AUD exchange rates some modest support this morning is a return to upbeat trading conditions.
As an acutely risk-sensitive currency, today’s positive market sentiment has been able to marginally lift the ‘Aussie’ against some of its safer assets.
GBP/AUD exchange rate forecast: UK data in the spotlight
Looking ahead, the primary catalyst of movement for the pound Australian dollar exchange rate this week will be several high impact data releases from the UK.
On Wednesday, the UK is set to release its latest CPI data, which could infuse volatility into GBP exchange rates a day before the Bank of England’s upcoming interest rate decision, on Thursday.
If Wednesday’s inflation figures influence expectations of a BoE rate cut or impact the central bank’s looming decision, Sterling may face additional pressure later in the week.
Turning to the Australian dollar, an ongoing absence of domestic economic data could keep AUD exchange rates largely subdued this week, and left trading without a clear direction.