The Pound fell against the Australian Dollar on Wednesday after GDP data out of the Oceanic nation came in above forecasts.
In the Asian session the Australian Dollar made gains against the majority of its most traded peers after a report released by the Australian Statistics Bureau showed that the nation’s gross domestic product expanded by a seasonally adjusted figure of 1.1% in the first quarter of 2014.
The rise was more than the 0.9% increase forecast by economists and added to the previous quarters reading of 0.8%.
On a year on year basis Australia’s GDP climbed by 3.5%, beating expectations for a figure of 3.2% and higher than the 2.8% recorded in the previous data release.
The rise was being attributed to increased exports and housing investment.
Despite the rise some economists are forecasting that the economy’s momentum is losing pace.
“The momentum of late 2013, early 2014 was never likely to be sustained,” said a senior economist at RBC Capital Markets.
Also offering some support to the ‘Aussie’ was the release of the Australian AIG Group’s Services Index for May which rose to 49.9 from a 48.6 reading in April.
Following the release of the data the ‘Aussie’ surged to its highest level in two-days against both the Euro and US Dollar.
As European markets opened the currency then lost some of its gains as concerns over falling commodity prices weighed.
The Australian Dollar is likely to experience volatility later in today’s session due to the release of market moving data out of the Eurozone and USA.
Positive data out of the US will likely send the ‘Greenback’ higher at the expense of the ‘Aussie’.
The Pound meanwhile is likely to regain some lost ground after the latest Markit Services PMI data came in better than forecast.
Activity in the UK’s service sector increased to 58.6 in May, beating expectations for a fall to 58.2.
Any figure above 50 indicates expansion whereas one below indicates contraction.
Australian Dollar (AUD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Australian Dollar,
,US Dollar,0.9274 ,
Australian Dollar,,Pound Sterling,0.5545 ,
Australian Dollar,,Euro,0.6810 ,
Australian Dollar,,New Zealand Dollar,1.1018 ,
US Dollar,, Australian Dollar ,1.0783 ,
Pound Sterling,, Australian Dollar ,1.8015 ,
Euro,, Australian Dollar ,1.4669 ,
New Zealand Dollar,, Australian Dollar ,0.9075 ,
[/table]
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