The Pound Sterling to Australian Dollar (GBP/AUD) is forecast to see muted trading next week as market activity will remain muted due to the New Year Holiday period and lack of market moving UK economic data releases.
Monday will see the publication of Australian New Home Sales data, which is likely to have very little impact due to most market participants being away on their Christmas and New Year holidays. Due to the lack of traders, the markets will likely experience choppy trading conditions due to reduced activity creating exacerbated movements.
Greece Presidential Vote to Create Exchange Rate Turmoil
The main event of the session will be the third and final Greek presidential vote, which is likely to create volatility in the markets. A defeat for Antonis Samaras will lead to the calling of snap general elections and the possibility that the Euro crisis will reignite. A defeat will also weaken demand for riskier assets such as the ‘Aussie’ and will likely see the Pound advance against the currency.
Tuesday sees the release of UK house price data, but again the report will have little impact on the currency pair. Depending on the outcome of the Greek vote, the Aussie is likely to remain under pressure from weak commodity prices.
Midweek sees the release of Australian Private Sector data, which is classed, as of medium importance. Private Sector Credit in Australia increased 0.60 percent in October of 2014 over the previous month. Private Sector Credit in Australia averaged 0.90 percent from 1976 until 2014, reaching an all time high of 2.90 percent in July of 1986 and a record low of -0.50 percent in July of 1992. Private Sector Credit in Australia is reported by the Reserve Bank of Australia. Economists are forecasting that Novembers figure will dip to 0.54%.
Australian Dollar to Pound Sterling (AUD/GBP) Exchange Rate to Fluctuate on UK and Australian Manufacturing Data
The latest Australian Manufacturing PMI data is released on Thursday. Economists are forecasting that activity in the sector slid into contraction territory in December, adding to concerns that the Australian economy will weaken over the course of 2015.
At the end of the week, the Pound could receive some support from UK Markit Manufacturing PMI and Mortgage Approvals data.
We forecast that the Pound Sterling to Australian Dollar (GBP/AUD) exchange rate could trend higher if the UK’s manufacturing gauge moves further away from the 50 mark separating growth from contraction, as is expected to be the case.
