- Pound Australian Dollar Exchange Rate Expected to Plunge on Bank of England (BoE) Rate Decision.
- Pound’s Strength Continues Today –Sterling consolidates and extends Monday’s gains.
- Pundits Back Theresa May as the Right Choice for Leader – Her previous cabinet experience and pro-‘Remain’ ties bode well for the Brexit negotiations.
- Australian Dollar sees marked Rally on Rising Risk Appetite – The lucrative ‘Aussie’ was helped further by strong commodities and global equities.
Political instability and the looming Bank of England (BoE) rate decision on Thursday weighed heavily on the Pound Australian Dollar exchange rate when the European session began on Monday.
However, the pairing soon rallied on the news that conservative party leadership hopeful Andrea Leadsom would be conceding the race to Theresa May. In the eyes of many investors and analysts May’s experience and pro-‘Remain’ ties place her in a good position to lead the country out of its current mess.
Sterling’s gains against the ‘Aussie’ were exacerbated due to falling oil prices placing downward pressure on the Australian commodity-sensitive currency.
The Pound Australian Dollar exchange rate currently trades at 1.7230 after showing minimal movement in the session so far.
Sterling (GBP) Bullish Today after News of Andrea Leadsom Conceding
Pound exchange rates have found favour lately on the news that Theresa May is the UK’s new Prime Minister.
On the announcement of Andrea Leadsom’s yielding in the Tory party leadership race, the Pound rallied notably due to the fact that there won’t be a drawn-out leadership contest.
Theresa May’s cabinet experience and her pro-‘Remain’ ties put her in good stead to lead the country during these tumultuous times. Analysts and investors expect May to negotiate a favourable trade deal between the European Union and post-‘Brexit’ Britain.
Already Sterling has gained further on confidence in Theresa May’s leadership today, edging up over 1.25% against the US Dollar as the ‘Buck’ is weighed upon by lessening safe-haven demand.
Today, Bank of England (BoE) Governor Mark Carney is speaking to parliament in regards to financial stability. If the central banker manages to stir up confidence in the British economy’s future then the Pound could expect to see further rallies before the day is out.
Australian Dollar (AUD) Bolstered on Strong Commodities and Rising Risk Appetite
The ‘Aussie’ had recently been experiencing a lack of demand due to the Australian federal election’s inability to conclude in a timely fashion.
Eight days of deliberation and vote counting ultimately resulted in a Liberal party-led coalition, headed up by Malcolm Turnbull. Prior to this, the lack of a clear front runner kept investors shy of the Australian Dollar but demand returned on Turnbull’s unofficial victory announcement.
Risk appetite appears firmly in gear this morning with the ‘Aussie’ rallying across the board, but the currency continues to trend narrowly against the recently strengthened Pound. Global equities are rallying and commodities are firmly up, giving the antipodean currency a notable boost that has been helped by the new Liberal-led coalition being an investor and analyst favourite for getting the Australian economy back on track.
Pound Australian Dollar Exchange Rate Forecast to Slide on BoE Rate Announcement
Any domestic UK data will be thrust to the way-side as all investors, traders, analysts and experts of all kinds will be looking forth to Thursday and the Bank of England’s benchmark rate decision.
The central bank is expected to cut its base rate to at least 0.25%, which could easily take the Pound back down into 30-year lows, but if the BoE elects to slash all the way to 0%, there is potential for massive depreciation. The bank will also be discussing its quantitative easing targets at the same time.
The Australian Dollar is likely to rise as the new Australian cabinet starts to settle in and quell the previous period of political instability. If commodities remain supported and Thursday’s Australian employment figures can print favourably there is scope for decent movement.
The financial world will be watching Thursday’s BoE rate announcement intently as it is guaranteed to effect movement in the Pound Australian Dollar exchange rate.
Comments are closed.