Brexit to dictate GBPAUD exchange rates

AUD GBP Struggles for Direction with Retail Sales Due

Last week GBPAUD exchange rates were heavily influenced by Brexit developments. There were a few key head lines.Firstly Brexit negotiations had hit deadlock according to head EU negotiator Michel Barniner however European Council President Donald Tusk believes the deadlock comments had been exaggerated. In addition UK Prime Minister Theresa May gave a speech at the EU summit late Friday and confirmed the UK and EU had made key progress and a deal on EU citizens rights is nearly secured and reports are suggesting that she could offer another €20bn for the divorce settlement fee.

It appears that Brexit negotiations are heating up, and if EU citizens rights and the divorce settlement bill are agreed, I expect that the pound will make considerable in roads against the Australian dollar. 

In other news there are a few key economic data releases to look our for in the weeks to come. On Wednesday morning Australia will release their latest inflation numbers. This data releases can have a major influence on future monetary policy decisions. Furthermore forecasters are still suggesting there is over 50% chance that the Bank of England will raise interest rates on November 2nd. If this occures GBPAUD exchange rates could break through the 1.70 barrier.

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