GBP/AUD rates have spiked up again during Thursdays trading, despite another set of poor UK Retail Sales figures. The latest figures, which were released this morning, came in under expectation at 0.1%. The markets were expecting a figure of 0.4% and immediately Sterling lost value against the majority of major currencies but in fact has made a gain of approximately a cent against the AUD.
The reason for this spike can be attributed to falling global commodity markets and due to Australia’s reliance of the export of their vast supplied of raw materials, yesterday’s report was always likely to hurt the AUD in the short-term. The markets have viewed this in a more negative light than the poor UK data and with on-going economic problems in China also hurting the Australian economy (due to the trade links between the countries), it is not a surprise to see the AUD struggling.
Personally I anticipate GBP/AUD rates to remain volatile in the short-term and although the AUD has found support around the current levels over the past month, I do not expect a major turnaround for the AUD under current market conditions.
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