The AUDGBP exchange rate was higher by 0.18% on Wednesday after the release of Westpac consumer confidence figures. The data showed that Aussie households were at their most confident since 2010 as the country remains on track for a healthy recovery.
AUDGBP trades at 0.5565 as it tries to move higher in its well-worn range of 0.55-5600.
Aussie Confidence Boost Lifts Expectations
The latest Australian consumer confidence numbers came in as expected at 118.8, which marked the highest reading for the index since 2010. After the government went through a difficult few-weeks due to its ‘botched’ coronavirus vaccine rollout, the prime minister was quick to jump on the Westpac-Melbourne Institute survey.
“Australians can see that Australia is coming through this pandemic, and the recession it has caused, better than almost any other country in the world today,” Scott Morrison said.
Westpac chief economist Bill Evans was also bullish on the result, saying:
“The survey continues to signal that the consumer will be the key driver of above-trend growth in 2021”.
The economist had expected the index to dip after the removal of the JobKeeper furlough scheme in March.
The strong labour market and demand for workers, has coincided with a booming housing market to lift the mood of Aussie consumers.
The economy may not be out of the woods after the treasury had previously estimated that the end of the wage subsidy program could see up to 150,000 lose their jobs. Tomorrow will be a big day in that regard as the Australian economy sees the release of its latest job numbers. An improvement of 35k jobs is expected after a strong number last month saw more Aussies in work than before the pandemic began. The unemployment rate is also expected to be lower at 5.7% and it may be that the furlough scheme ended too late to impact this month’s reading.
Pound Surrenders GDP Gains
The British Pound was unable to capitalise on a stronger GDP reading with a 0.4% growth jump in February. Large funds unwound bets on sterling last week over fears that the good news is priced in, with the government dragging their feet on a return to foreign travel.
The UK has moved onto the next path of its reopening plan with “non-essential” businesses opening their doors for the first time since early-January. The country had seen a record amount of savings built up over the lockdown period and much of this will be unleashed on the domestic economy as holidaymakers see their plans for a getaway facing headwinds.
The pound was also lower after the Bank of England’s Chief Economist Andy Haldane announced he was leaving in June. Haldane was one of the lonely hawkish figures at the bank and his comments on inflation were recently not aligned with those of the bank’s governor, which is maybe the reason for the departure. The economist is moving to a role with the Royal Society of Arts in September.
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