The AUDGBP exchange rate was lower after the latest Sydney lockdown. The city was shut down for two weeks after reporting cases of the Indian variant. Economic data also saw house prices surge in the UK, although that was boosted by the removal of the stamp duty benefit this month.
AUDGBP is trading at 0.5427 and the Aussie dollar could see action with the release of trade balance figures.
UK sees surge in house prices
Average UK house prices were 13.4% higher into June, which was the last month that buyers could use the stamp duty benefit. A suspension of stamp duty on sales of up to £500,000 was introduced last year to help the market recover and the measure ends on June 30th with the threshold falling to £250k.
Prices hit £245,432 this month, according to the Nationwide, which was the highest level since November 2004. The figure is also 0.7% above the May price.
Regional data for the three months to June showed all parts of the country gaining, but the the largest gains were in Northern Ireland and Wales in the second quarter. Scotland had the weakest annual growth rate, at 7.1% closely followed by London at 7.3%.
The market has been boosted by factors such as new housing needs during lockdowns, with buyers looking for more space or a home office. A new help to buy scheme was also introduced by Rishi Sunak.
The housing prices are likely to slow next month after the expiry of the current stamp duty relief. The pound will see a final reading of the Q1 growth rate and that may not change much from the prior releases.
Australia tightens the lockdown
Australia reported a rise in virus infections, while officials in several states tightened restrictions and pushed for vaccinations.
After months without the virus, Australia is seeing the variant in five of its eight states and territories, just two weeks after an infection in Sydney. Worries about the variant have seen lockdowns in three large cities and restrictions in several more, affecting more than 20mn Australians, or about 80% of the population. The UK is seeing cases at 20,000 but the country is still open with a larger amount of vaccines delivered.
The latest surge will be a blow after a recent strong employment release which had traders thinking about an earlier end to the current monetary policy and stimulus.
“The risk is real and we need to act quickly, we need to go hard, we need to go fast,” said Queensland Premier Annastacia Palaszczuk said.
Trade balance figures are released for the Aussie economy and that is expected to show growth in Australia’s trade picture with A$10bn for May, which is up from £8bn in the previous month.
The AUD to GBP exchange rate looked to be back on the offensive but the last two days has seen the gains disappear.