This rollercoaster market continued overnight following some poor unemployment data from Australia. Forecasted figures of 5.8% actually came in at 6% and as a result the GBP/AUD rate rallied back though 1.86, since it has corrected slightly back into the 1.85’s but certainly better than for AUD buyers than the 1.81 seen earlier this week.
The unemployment figures overnight followed on from what was a very strong day for the pound after the Bank of England quarterly inflation report and forward guidance speech from Mark Carney. In the report the bank revised up the UK’s growth forecast over the next three years and indicated that they expect inflation to dip lower below the bank 2% target and hence less pressure to raise interest rates, this as a result could help keep the pound in check.
As with any market you have to expect the unexpected and the Australian Dollar is certainly doing that. For me I am still confident that the pound will see increased value in the coming months however other factors that cannot be forecast or predicted have to be taken into account. In this instance the weather the UK is currently experiencing. It is the wettest season in 250 years and with total damage already estimated in excess of £100 million and the loss of economic activity from the floods and disruption to road and rail, it is inevitably going to have an adverse effect on the UK GDP. For this reason it is important to have as much information available to you when making your decision as when to trade and the services of a broker can become essential.
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