AUD GBP Falls as UK MPs Propose Second Referendum on Brexit
Strong data hasn’t been enough to keep AUD GBP from falling, as UK MPs have tabled a motion for a referendum on the terms of Brexit.
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AUD GBP Weakens despite Strong Australian Data Docket
Recent Australian data has printed positively, yet the ‘Aussie’ is on the decline versus the Pound. Consumer confidence rose by more than one point, while NAB business conditions index rose from 5 to 11 and the business confidence index from 5 to 6.
Private sector credit also saw strong growth, increasing from 0.5% to 0.7% on the month and from 5.4% to 5.6% on the year; forecasts had been for a stagnation in both cases.
Pound Recovers on Talk of Second Brexit Referendum
Sterling has been able to recover from earlier weakness today on the news that several MPs have tabled an amendment to the Article 50 bill that would require the Prime Minister to hold a second referendum on Brexit.
The amendment states;
‘A referendum is to be held on whether the United Kingdom should approve the United Kingdom and Gibraltar exit package proposed by HM Government at conclusion of the negotiations triggered by Article 50(2) for withdrawal from the European Union or remain a member of the European Union.’
If this were passed – which is considered highly unlikely – it would give the British people a chance to block Brexit, were they not happy with the terms Theresa May would have secured during the negotiations.
The Pound had previously fallen when consumer confidence scores showed that households were feeling much more concerned about the economic outlook than this time 12 months ago, while fewer thought now was a good time to make a large purchase.
AUD GBP Exchange Rate Forecast; Chinese Manufacturing could Overshadow Australian Data
There are several pieces of Australian data on the calendar today, including the AiG performance of manufacturing index, the CoreLogic house price index and two commodity price indices. However, Chinese manufacturing data is likely to be the key driver of the Australian Dollar.
Meanwhile, UK shop prices and house prices data and the Markit manufacturing PMI are set for release today.