The AUD GBP exchange rate was lower on the week as the pound regained some ground, despite lower GDP figures for the economy on Friday. The week ahead will see UK employment data on Tuesday, alongside the latest inflation on Wednesday. The Australian economy will see the latest Westpac consumer confidence on Wednesday with unemployment updates on Thursday.
The AUD to GBP exchange rate trades at 0.5308 as the week starts and will aim for the round number.
Another record for Australian virus cases
The Aussie dollar won’t be helped on Monday by the latest virus numbers showing another record. Friday saw a record increase of cases in Australia at 2070, which was largely driven by over 1500 new infections across NSW.
Some 450 new cases were reported in Victoria on Saturday, which is a high for the latest outbreak and an additional five new cases in Queensland, where a lockdown could be looming.
“There is no lockdown today,” said Premier Annastacia Palaszczuk.
But she warned the government may have to take “very quick, fast action” in the next 24 to 48 hours. It is the second consecutive day that the country has seen a record number of daily cases during the pandemic and comes as the Prime Minister tries to get rogue states to join the national plan to end lockdowns.
There is a national agreement to reduce lockdowns at 70 percent vaccinated and use only highly targeted restrictions at 80 percent.
“Lockdowns and lockouts once you get above that 80 percent vaccination rate, they do more harm than good,” Scott Morrison said on Friday.
UK employment figures will lead the data this week
UK employment numbers will be the first economic data release to drive the AUD to GBP pair this week.
UK unemployment has improved over the last few months, with a sharp drop in the claimant count since March, while Australia is going the opposite way with the recent lockdowns.
The UK unemployment rate for June saw a slight decline to 4.7%, but the furlough scheme is still masking some of the damage. The number is forecast to drop further to 4.6% for the three months to July but staff shortages are hampering the effects.
The Australian jobs number is released on Thursday and is expected to confirm the opposite trend with an unemployment rate of 4.6% rising to the 4.9% level as lockdowns bite.
Headwinds for the UK jobs market could be the ending of the furlough scheme at the end of September and last week’s hike in the National Insurance tax rate. The British Chambers of Commerce (BCC) said the latter would hit the wider economic recovery while Make UK, which represents the manufacturing sector, said it was “ill-timed as well as illogical”.
The GBP to AUD exchange will look to test the 0.5300 level early in the week and the data will determine the next path.