Sterling hit a 5 month high during late yesterday against the Australian Dollar but has fallen back from its recent run to 1.56 following the lower than expected UK GDP figures. With the UK now officially in recession with a negative Q1 of -0.2% this has put a stop to Sterling’s recent strength. However, with the RBA still quite likely to cut interest rates I personally think we may see 1.60 in the next few weeks. Any further buying Australian Dollar opportunities could be negatively affected depending also on upcoming data releases from China.
Meanwhile Sterling has gained against the Euro to hit the best exchange rate in over 18 months at 1.2237 and even after the negative GDP figures we have seen Sterling continue to gain in strength against the single currency. EUR/USD is trading at 1.32 this afternoon and GBPNZD is at 1.99 with expectations for the Sterling Kiwi exchange rate to hit 2 to the Pound by the end of the week.