The pound to Australian dollar exchange rate has been supported with rates sitting just below 1.80 for the GBP to AUD pair. Brexit uncertainty has kept the pound at bay in recent weeks although some optimism that a deal will be reached is helping lift the pound slightly. What is interesting though is that despite some stronger economic data from the UK the pound is struggling to find any real momentum for a big jump higher. It highlights how the wider issue of Brexit is preventing the pound from gaining until clarity is offered on a deal. The risk of a no deal remains and with parliament now prorogued until October 14th it leaves an uncertain period ahead of that Brexit deadline of 31st October 2019. The markets will now pay particular attention to the next EU summit to be held 17th October. It remains to be seen whether a last minute concession will be offered at this time for an agreement to be reached between Britain and the EU. Those with pending requirements to either buy or sell Australian dollars would be wise to plan around these important dates. A hearing in the Supreme Court next week will also be held after arch Remainer Gina Miller lost a court case in the high court when it was concluded it was legal for Boris Johnson to prorogue parliament. Today the highest civil court in Scotland has overturned that ruling stating the suspension is unlawful. Expect more volatility and Brexit twists and turns depending on that outcome at the Supreme Court next week.
UK economic data is light for the UK so focus will turn to Australian inflation expectations released overnight. The Reserve Bank of Australia has cut interest rates twice over the summer which has helped see the dollar weaken. The ongoing trade was between the US and China continues to impact on the global economy to which the Australian dollar is adversely affected. For more information on the Australian dollar and how to plan around these important events then please contact me James at [email protected] and I will be happy to assist.