Sterling has taken a hit over the past hour following the latest Bank of England (BoE) interest rate decision. GBP/AUD rates have dropped by almost 2 cents from the high of today, bringing some much needed respite to AUD sellers after a tough week. Whilst it was widely anticipated that the BoE would keep rates on hold at 0.5%, it was the suggestion that we may see more than one member vote for a rate rise, which was driving Sterling’s value up over the past couple of days.
GBP/AUD rates have moved back under 2.14 and we may now see some support for the AUD over the coming days. Whilst I do not expect to see a major upturn in the Australian economy any time soon, these pockets of support become even more influential to investors.
The AUD has been handicapped for months, due to the slowdown in both the Australian and Chinese economies. With the Reserve Bank of Australia (RBA) committed to lowering the value of the AUD in order to boost exports, it is no surprise to see the AUD struggling. Personally I wouldn’t be gambling on a significant improvement for the AUD and I would be tempted to monitor the market for a short period and move quickly as an AUD seller if the current positive spike seems to be waning.
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