The Australian Dollar rose slightly yesterday, as it usually does during times of low volume when markets are impacted by holidays.
The boost in AUD’s value was mainly due to weakness in the US Dollar as the Atlanta Fed published it’s ‘GDP Now’ figures which disappointed after the figure was cut from 1.4% to 0.6%.
As news coming out of the region is thin at present I’m expecting today’s speech by Janet Yellen, the chairlady of the Fed, at 4.20pm GMT time to provide some direction for the Australian Dollar against the US Dollar and I think AUD could benefit further should Janet Yellen adopt a dovish tone. There have been mixed messages from the Fed as of late so I’m hoping that the Fed Chairlady is more straightforward with her opinion on the state of the US economy moving forward.
With regards to the Pound I think ‘Brexit’ fears will continue to weigh on its value, and unless oil prices take another significant nosedive I’m not expecting AUD to lose ground on GBP as the pair are mostly driven by sentiment at the moment with Sterling coming off worse.
Those looking to sell Australian Dollars in order to purchase British Pounds may wish to take advantage of current levels, as since the beginning of the year the Aussie Dollar has strengthened considerably. For how long the pair trade at around current levels of 1.88 – 1.92 I think depends on the outcome of the UK’s upcoming EU referendum, and I’m expecting GBP to spike upwards should the British public opt to stay within the EU.
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