Equal Disappointments Prevent Clear Advance in AUD GBP Exchange Rate
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Australian Dollar Weakened by Retail Sales Disappointment
AUD traders have been left unsettled by recent retail sales data, which has kept the AUD GBP exchange rate tight.
In August, retail sales were reported down at -0.6%. This was an especially poor result because economists had expected a 0.3% rise.
Commenting on the news, ABC Business Reporter Michael Janda said;
‘The -0.6% slump in retail turnover during August was the worst in almost four-and-a-half years.
Adding to the negative surprise was a downward revision to July’s number, now a -0.2% fall. Worse still, the weakness was spread across the country, with sales in every state falling.
Even worse, sales fell in almost every type of retailing…a handful of people saw the fall coming, but even they didn’t quite predict the magnitude of the drop’.
Pound Trades Tightly as Traders Process PM’s Speech
In the UK, the Pound has been flat because of growing concerns about the Conservative government.
While the current administration has had its hiccups, a known leadership is still considered more stable than the untested Labour alternative, economically speaking.
In spite of this attitude, however, analysts have been struggling to say that all is well after Theresa May’s mishap-laden speech on Wednesday.
Conservative Party officials were divided on how to respond to the matter. In May’s favour, some MPs stated that the PM had bravely soldiered on against the odds and voiced their continued support.
On the other hand, however, Ed Vaizey has given much more critical feedback. Formerly the Minister for Culture and a sitting MP, Vaizey has warned;
‘I’m finding it increasingly difficult to see a way forward, at the moment, and it worries me.
I think there will be quite a few people who will now be pretty firmly of the view that [May] should resign.
The Tory party conference was a great opportunity to reboot the party and therefore reboot the country to give a clear sense of direction and that did not happen, and so yes I am concerned’.
In the unlikely event that a move is made against the Prime Minister, the Pound could decline sharply because of the problems this would bring.
AUD GBP Outlook: Australian Dollar could Slide if US Dollar Strengthens
Friday is not expected to bring domestic data of interest, so traders could pay closer attention to US Dollar movements.
If the US Dollar appreciates on the afternoon’s jobs data, the Australian Dollar could be forced down in the AUD GBP pairing.
Recent Interbank AUD GBP Exchange Rates
At the time of writing, the Australian Dollar to Pound (AUD GBP) exchange rate was trading at 0.5937 and the Pound to Australian Dollar (GBP AUD) exchange rate was trading at 1.6838.