The AUDGBP exchange rate was 0.28% lower on Tuesday after the UK released its latest growth figures. The British economy managed to grow by 0.4% in February despite the ongoing lockdown and could lead to further growth upgrades for later in the year. Australian employment figures will be the next big release on Thursday this week.
AUD to GBP trades at 0.5525 after the Australian Dollar failed to capitalise on recent sterling weakness.
UK Gets a February Growth Surprise
The UK economy has improved by 0.4% in February after a rebound from January’s 2.2% decline, according to the Office for National Statistics.
Manufacturing grew by 1.3% following a contraction in January and this was echoed in last week’s PMIs. The construction sector improved by 1.6% and this also saw strong figures last week so the UK economy is likely to have grown in February and March ahead of the reopening.
The latest growth figures are another boost for the UK as it moves to the next phase of its reopening plan with retail establishments and theme parks reporting a bounce yesterday, despite a colder bout of weather.
The latest economic figures could see further upgrades to UK growth expectations after the IMF upgraded the economy to a 5.3% expectation in 2021, which added to a recent OECD upgrade. Australia has not suffered with the same level of lockdown and the UK could power ahead in growth as figures emerge over the course of the year.
Australia Abandons Vaccine Targets
The Australian government has said it won’t buy the single-dose Johnson & Johnson coronavirus vaccine and also reported a second blood clot case from the AstraZeneca shot.
“J&J is another viral vector vaccine and we have no advice recommending, at this point, that the government purchase any additional viral vector vaccine,” Australia’s Health Minister told reporters.
Australia’s failed virus vaccine rollout is expected to cost more than $1.4 billion, with the country being trapped over the next months as the UK reopens. New South Wales Premier Gladys Berejiklian has said she worries that Australia will be left behind unless the government takes swift action.
“There will come a point when the rest of the world starts engaging with each other more and we can’t afford to be left behind,” Berejiklian said. Australia has ditched its vaccine targets after it had planned to have 20 million residents vaccinated by the end of October. The country has only administered 1.1 million vaccines and has been hit by issues surrounding the AstraZeneca jab.
The AUDGBP rate moved away from the 0.5500 level last week after seeing new lows for the year beneath that figure but the pound is moving back in that direction. The Australian economy will see the release of Westpac consumer confidence tomorrow and Thursday will bring an employment update, so it could become an important week for the Australian Dollar and British Pound exchange rate outlook.
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