AUD GBP Lower Ahead of UK GDP Update

AUD GBP Higher after Inflation Data, Sunak Budget Ahead

The AUD GBP exchange rate was lower on Thursday by 0.27% after the recent Aussie dollar rally fades out. WA Premier Mark McGowan has said that the Australian border could remain closed for seven months. The Australian dollar had been boosted by hopes for a near-term end to lockdowns, but some government officials seem to have other ideas.

The AUD to GBP exchange rate trades at 0.5330 with a UK GDP update out today.

Western Australia border to be shut for a further seven months

Western Australian Premier Mark McGowan has confirmed that the state will likely remain closed off from the country for another seven months.

McGowan previously said that he wouldn’t allow interstate travel with WA until more than 80% of locals are fully vaccinated but hasn’t confirmed when that target will be reached.

The Premier said the domestic border may remain shut until April 2022, while boasting the international travel ban, has been good for the state’s economy.

“We’ve got to, obviously, open eventually but it’s been a remarkable economic boom for Australia not having international borders open because for every international tourist that arrives, there’s way more than one Australian that goes overseas and we spend more,” McGowan said.

“Somewhere above 80 per cent we’ll try and set the date. I don’t know whether it’ll be February, March or April, I suspect it will be one of those months,” he told reporters.

Mr McGowan clashed with federal Treasurer Josh Frydenberg, who said his tough approach to closures meant Australians would be able to travel to Canada before they could get to Perth.

UK set to see a sharp slowdown in growth: Chamber of Commerce

The UK is set for a sharp slowdown in economic growth due to the ongoing supply chain crisis and staff shortages, according to the British Chambers of Commerce.

The group also warned of a “real danger” the Government’s health and social care levy could further derail the economic rebound in the country.

The statements came after the government this week announced a 1.25% national insurance tax hike to raise £12 billion for the NHS backlog and social care system.

The BCC cut its forecast for GDP in the third quarter to 2.8% from 3.5% previously and said that supply chain disruption and hiring difficulties are threatening the reopening bounce in the economy.

The BCC also predicted that Britain’s GDP, which was 4.8% in the second quarter, would ease to 1.6% in the October to December quarter.

The UK will get another GDP update today in a 3-month average to July and that is expected to show a further slowdown in growth, with most economists expecting a 0.5% expansion, down from 1% in June.

The GBP to AUD exchange recently saw yearly lows above 0.5220 before a relief rally in the Aussie dollar. The situation is still bleak in the country however, and the bounce has stalled above the 0.5350 level.