We have seen a difficult week for the Pound vs the Australian Dollar as rumours increase that the UK could be getting ready to trigger Article 50 early next year. Last weekend European Council President Donald Tusk said that in a conversation recently with Theresa May that the UK is getting things ready to to start negotiations by February. However, shortly after this his words were retracted and the story didn’t gain any further momentum until late this week.
Our very own Foreign Minister Boris Johnson has said whilst in the US that the UK will begin formal talks ‘early next year’ and leave the European Union by 2019. However, Downing Street has confirmed that it will be Theresa May’s decision alone when to trigger Article 50.
What is for certain is that the lack of clarity is causing weakness for Sterling exchange rates across all major currencies including against the Australian Dollar causing the Pound to hit the lowest level to buy Australian Dollars in weeks.
As we go into next week we could see GBPAUD rates fall even further with the release of the second quarter GDP for the UK on Friday. As this will include the run up to the Brexit we could see some interesting figures and as the first official release of GDP during this time if the data comes out negative this could cause even further woes for the Pound vs the Australian Dollar.
Politically the UK is in a state of limbo and until we get some assurances as to when Article 50 will be triggered this could weigh heavily on the Pound and I would not be surprised to see GBPAUD rates fall even further during the short term.
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