The Pound Sterling to Australian Dollar (GBP/AUD) exchange rate softened on Thursday following the release of better than expected Australian employment data and as the ‘Aussie’ took advantage of a slightly weaker US Dollar (USD).
The Pound Sterling to Australian Dollar (GBP/AUD) Exchange Rate touched a session low of 1.9517
The Australian Dollar also made gains against the US Dollar to move away from a six year low. Demand for the US currency softened as economists suggested that its recent strong gains had been overdone and as investors turned their attention to the release of upcoming US jobless claims and retail sales data.
According to data published by the Australian Statistics Bureau, the Australian economy created 15,600 new jobs in the month of February after cutting 14,600 jobs in the preceding month. The rise in job creation beat economist expectations for a rise of 15,000. The report also showed that the nation’s overall jobless rate fell from 6.4% to 6.3%.
‘So far in 2015 households appear to be getting more positive about the labour market, the trend is heading in the right direction. The improvement suggests that the recent rate cut may have already had an impact on expectations. We will have to wait to see if it translates thought to real economic activity,’ said Westpac senior economist Justin Smirk.
Separately, the Melbourne Institute said that its inflation expectations for the next 12 months slipped to 3.2% in February from 4.0% the previous month.
Further losses for the Pound were restrained as data released in the UK showed that the nation’s trade deficit narrowed sharply in January. The deficit narrowed to its smallest size since mid-2013 due a surge in service exports and the fall in oil prices.
The London based Office for National Statistics said that the total deficit shrank to £616 million from the £2.14 billion in December.
The deficit in trade goods also narrowed to £8.41 billion, the smallest deficit recorded since March 2014.
Pound Sterling to Australian Dollar Exchange Rate Forecast
The Pound is forecast to make gains against the ‘Aussie’ in the long term as economists say that the value of the Australian Dollar remains high and that the Reserve Bank of Australia will make further interest rate cuts over the coming months.
The ‘Aussie’ will likely give up earlier gains if upcoming US jobless claims and retail sales data comes in better than forecast.
