The AUD has strengthened against GBP during Thursday morning trading following worse than expected UK Trade Balance figures. These figures indicate that our trade deficit, which is already a major cause for concern, is continuing to widen. Ultimately this means we are spending more on imports than we are making from our export industry and this will certainly hamper the UK’s chances of a full economic recovery. This point was made by new Bank of England (BoE) governor Mark Carney during his recent address to parliament, where he highlighted the need to reverse this deficit.This concern by the BoE is another reason I believe we will see GBP’s level’s controlled, in order that we do not alienate our trade partners even further.
Despite this negative data the Pound has performed well against the AUD of late and continues to hold firm above 1.70. With negative growth forecasts predicted by the Reserve Bank of Australia (RBA) for the rest of 2013, I believe the AUD may struggle to move much higher than current levels.
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