The Pound has hit a new high against the Aussie Dollar today, as the pair have hit 1.7220 at one stage during today’s trading session.
The upward movement for the Pound begun early mostly due to Aussie Dollar weakness, as in the early hours of this morning the Australian inflation data came out worse than expected on both an annual and monthly basis albeit not drastically.
At the same time Sterling has performed well across the board during today’s trading session and at the time of writing the currency is up against all major currency pairs.
There has been talk of the Australian economy slowing in recent months, and with the US Fed Reserve now likely to continue to raise interest rates throughout the year I think the Aussie may end up trading quite considerably lower against the Pound as the year progresses. An increasing interest rate in the US could be bad news for the Australian Dollar as its likely that investors would rather hold their funds in the US due to the higher level of security it offers.
Limited demand for the Aussie Dollar is the reason I think we could see the GBP to AUD rate improve as the year goes on, but I do think that if the conservatives in the UK don’t win the election in June we could see another sell-off for the Pound.
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