GBP/AUD, GBP/NZD Exchange Rate Forecast: Trade on Commodity Currencies Cautious in Anticipation of US Employment Figures
While Sterling (GBP) has strengthened today due to a good performance on the UK Construction PMI, traders of both the ‘Aussie’ (AUD) and ‘Kiwi’ (NZD) remain cautious ahead of upcoming US employment data.
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Unexpectedly Hawkish UK Construction PMI Puts Pound (GBP) on Bullish Run with Increased Optimism
After yesterday’s UK Manufacturing PMI, which nevertheless showed a decline in growth albeit a slighter one than forecast, the Pound (GBP) remained on a generally positive trend against rivals. This morning saw some stronger support materialise for Sterling as the domestic Construction PMI printed far above expectations, rising from 57.3 to a seven-month high of 59.9. Indicating that the construction industry in the UK has continued to expand in spite of wider global slowdown fears, this prompted another surge in demand for the British currency.
Rising Australian Retail Sales Fail to Support ‘Aussie’ (AUD) with Trade Bearish on Continued Fed Rate Hike Speculation
This afternoon’s upcoming US employment data has been weighing on the ‘Aussie’ (AUD) today, as these figures are regarded to be of particular importance for gauging the domestic economic conditions and thus play a crucial role in the Federal Open Market Committee’s (FOMC) decision on interest rates. With investors cautious ahead of this release, movement has remained relatively bearish for the antipodean currency, in spite of August Australian Retail Sales figures having shown some decided growth. Although the local economy continues to show signs of improvement, the prospect of a stronger ‘Greenback’ (USD) remains a significant dampener on ‘Aussie’ sentiment.
‘Kiwi’ (NZD) Holding Ground Today after ANZ Commodity Price Index Revealed Improvement
Although the commodity-correlated ‘Kiwi’ (NZD) stands to be equally driven down by any near-term rise in US interest rates and the resultant strengthening of the US Dollar, the GBP/NZD exchange rate has remained on a minor downtrend this morning. Recent support for the dairy industry and a relative stabilisation in prices is likely to be the primary cause for this holding of gains in spite of a bullish Pound. The morning’s ANZ Commodity Price gauge showed decided improvement on the month, rising from -5.2% to 5.5% to reinforce a more positive picture of the New Zealand economy that has helped allay some of the fears of an imminent Fed rate hike.
GBP to AUD, NZD Exchange Rates Forecast: Strong US Data Could Weaken South Pacific Currencies to Sterling’s Benefit
Should the upcoming US Unemployment and Change in Non-Farm Payrolls figures prove sufficiently hawkish, the GBP/AUD and GBP/NZD exchange rates could see a marked surge in value, as strong data will lead to a decline in risk appetite and demand for commodity currencies. If a smaller than anticipated number of jobs were added to the US economy over the last month, however, both the ‘Aussie’ and ‘Kiwi’ are likely to make gains ahead of the weekend.