The Pound Sterling to Australian Dollar (GBP/AUD) exchange rate softened slightly late in Wednesday’s session as oil prices inched higher on speculation that recent drops have been overdone. Worries over the rout of the Russian Ruble also eased as action by Moscow snapped a seven day decline.
The Pound Sterling to Australian Dollar (GBP/AUD) exchange rate strengthened on Wednesday and is heading towards its highest level since 2009 as the ‘Aussie’ dropped sharply ahead of the US Federal Reserve’s interest rate decision.
Australian Dollar Fell to Fresh 4-1/2 Year Low against US Dollar
The ‘Aussie’ was weakened as markets grew jittery ahead of the US Federal Reserve’s upcoming policy statement and as Tuesday’s Reserve Bank of Australia minutes continued to put pressure on the currency.
The minutes showed that RBA policy makers would continue to leave interest rates at record low levels for an extended period. Risk aversion was also continuing to impact upon perceived riskier assets as commodity prices continued to weaken and as economic data out of China came in below forecasts.
Investors are also cautious ahead of the Federal Reserve policy statement due this evening, as ongoing speculation over the prospects for a U.S. rate hike next year have fuelled expectations that the U.S. central bank could adjust its forward guidance.
‘The Aussie has been on borrowed time. We’d been wondering when it would break, given that there is ongoing expectation, chatter about the Reserve Bank cutting rates next year, that commodity prices have not found a base. We had another fall in iron ore prices overnight,’ said Sean Callow, Senior currency strategist from Westpac.
UK Data Supports Pound Sterling (GBP) Exchange Rate
According to the Office for National Statistics, the UK’s claimant count fell more than forecast in November. The report showed that the number of Britons filing for unemployment benefits fell to a seasonally adjusted -26,900 from the -25,100 seen in the preceding month. Economists had been expecting a drop to -21,200.
A separate report also showed that UK wage growth overtook inflation as pay packets including bonuses grew by 1.4% from the previous year. Average earnings excluding bonuses rose by 1.6%.
Also supporting the Pound was the Bank of England minutes, which showed that two policy makers continued to call for a rise in interest rates. The UK’s unemployment rate remained at 6%.
Pound Sterling to Australian Dollar Exchange Rate
The Pound Sterling to Australian Dollar Exchange Rate Hit a Session High of 1.9308.
The Pound Sterling to Australian Dollar Exchange Rate Hit a Session Low of 1.9111.
The Pound Sterling to Australian Dollar Exchange Rate was trading in the region of 1.9156.
