The Australian Dollar has taken a turn for the better as the new week gets underway. Recent performances from AUD have been lacklustre and paired with the ongoing bushfires that engulf the countries resources, Australia did not start the year on the front foot. However, it now appears that AUD could be getting back on the right track as both retail sales figures and global factors come in to support the currency. Meanwhile, GBP awaits important data which is due to be released this week. The first will come today in the form of November’s GDP number. Investors will be hoping for positive data as the BoE upped the ante on the potential of a rate cut for GBP in the future, but the Sterling isn’t priced for a rate cut any time soon.
AUD Picks Itself out of Poor Performing Run Thanks to Retails Sales Figures
AUD has been under pressure lately, both from poor economic data and the bushfires which are ongoing throughout the country. The fires have taken a huge amount of the countries resources and have diverted these resources from their usual pathways which is likely to influence Australia’s economic figures. Luckily, AUD received positive news in the form of November’s retail sales. The figures showed a strong 0.9% rise for the month. This beat the expectations which were set at 0.4%. The data came as a broad-based rally in global stock and commodity markets, which usually has a beneficial supportive environment for AUD. The comeback from AUD saw the GBP/AUD exchange rate slip as AUD edged up on GBP. However, recent reports have suggested that the economic impact of the bushfires has been significant enough to seriously consider an interest rate cut, this boosted the odds of a cut up to above 50%.
GBP Waits on Important Economic Data Which Could Settled the Score With AUD Rates
As AUD performed and edged up on GBP, the UK sat awaiting its run of important economic data which is set to be released this week. The first, which will come later today, is the November GDP figure. The consensus is expecting a second consecutive 0% change for November, which would see the UK economy across the halfway line of Q4 without making any growth at all. Furthermore, Wednesday and Friday will see the UK’s inflation and retail sales data released. These figures will be important for the strength of the GBP as Boris Johnson moves forward with his Brexit negotiations.
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