The AUD GBP exchange rate was lower again as the UK recorded its highest inflation since 1997. The latest surge to 3.2% was also the highest monthly jump ever recorded by the ONS as prices increase with energy, used cars and food. Australian bulls anxiously await the latest employment figures from Australia on Thursday.
The AUD to GBP exchange rate trades below 0.5300 and without support will move back towards the yearly lows at 0.5223.
UK inflation reaches highest level since 1997
UK inflation rates reached their highest level since 1997 and the biggest jump on record in August, adding to pressure on households with the recent tax rise.
as the government ramps up taxes on workers and prepares to cut universal credit benefits
The Office for National Statistics said the CPI measure of annual inflation rose to 3.2% in August, up from 2% in July, with analysts expecting 2.9%.
The latest measures marked a sharp jump in food and drink prices from August 2020 when the “eat out to help out” discount scheme cut the cost of restaurant meals.
The 1.2 percentage point increase between July and August was the largest since records began in January 1997, the year Gordon Brown handed the Bank of England independence to manage inflation.
“The last thing working families need right now is another living standards crisis,” said Frances O’Grady, of the TUC.
Rehana Azam, a national secretary at the GMB trade union, said: “Surging inflation is part of a perfect storm that includes the public sector pay freeze, the imminent cut to universal credit and the withdrawal of the furlough scheme, and the national insurance hike that will cost care workers £150 a year”.
The latest figures also put pressure on the Bank of England to raise interest rates and reduce stimulus.
Traders anxious for Australian employment release
Tomorrow sees the latest Australian employment figures and comes on the heel of the strong UK release this week where the unemployment rate dropped from 4.7% to 4.6%. The Australian jobs market is expected to reverse with the unemployment rate moving from 4.6% to 4.9% as the government lockdowns reverse the strong economic rebound.
Analysts are expecting a loss of 90k jobs for the economy and the latest figures by employment agency SEEK, showed a “stark” drop in vacancies.
The August 2021 job numbers showed that national job ads decreased by 5.3 per cent month-on-month. According to SEEK’s August Employment Report, lockdowns in NSW and Victoria had a major impact on the jobs market, with listings declining in the states and territories under the strictest lockdowns.
“In August we have again seen the stark impact of COVID-19 restrictions,” said Managing Director, Kendra Banks.
“South Australia, Western Australia, Tasmania and the Northern Territory had increases in job ad volumes. Conversely, levels in Victoria, New South Wales, Queensland and the ACT have declined following various increases in local restrictions and lockdowns.”