The AUDGBP exchange rate was 0.12% higher on Thursday as the pair looks for an extension to the sharp bounce seen on Tuesday. The pound was threatening to make an important break below the 0.5500 level, but a sell-off in sterling saved the Australian dollar.
AUD to GBP will now look for the 0.5600 level and currently trades at 0.5544.
IMF Upgrades UK growth Outlook
The International Monetary Fund has increased its expectations for Britain’s economy with the group raising its outlook for the year from 4.5% to 5.3%.
The UK’s quick vaccination program and the latest budgetary stimulus was cited as reasons for the upgrade. Britain and the Eurozone are expected to return to pre-virus growth levels next year, which is slower than the US or Japan, which will get there this year.
Britain will outpace the European economies in 2021, but the figures were conducted before the latest lockdown in France and could see further pressure on the EU recovery. The pound sterling had been on a strong rally as the economy moves to reopen, but this hit a roadblock as Boris Johnson dragged his heels on a return to foreign travel, while he also looked to continue with rules and red tape that could curtail the recovery in the country.
The deputy director of the IMF research department said that the recent emergency spending and tax cuts in Rishi Sunak’s budget accounted for almost half of the increase in Britain’s 2021 growth upgrade.
Australia Continues With AstraZeneca despite Warnings
Australia has decided to push ahead with the rollout of its AstraZeneca vaccine supplies despite warnings from the EU. The concern relates to the recent links between the vaccine and blood clots and Australia’s regulators will conduct further studies to determine their suitability.
Any delay would be a blow to the Australian dollar after the country missed its deadlines for the rollout set in January.
“At this point, there is no advice to suggest there would be any change to the rollout of the vaccine,” Prime Minister Scott Morrison said. Britain are suggesting the under 30s should get an alternative vaccine, while Italy has said that AstraZeneca should only be used on people over the age of 60.
We said yesterday that the announcement of the Australia and New Zealand travel bubble would not be met with huge excitement by traders after the last two were cancelled. Only one day later and the current agreement is already in jeopardy after the New Zealand authorities announced a virus case.
The Australian and New Zealand travel bubble was set for April 18th and events in coming days will determine whether it goes ahead. The Australian economy has been performing well despite the access across the Tasman being blocked.
AUDGBP has a path to 0.5600 and the next trading sessions will determine whether the Aussie dollar can finally hold onto a rally against the Pound after a weaker 2021.
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