The Pound against the Australian Dollar has opened up by moving positively throughout this morning’s trading session after a rather volatile week last week.
Global investors are clearly wary of the slowdown in China and this is being reflected in the Australian economy.
With US-China Trade Wars still not fully resolved the appetite of a global investor has waned towards the more commodity based currencies including the Australian Dollar, New Zealand Dollar and South African Rand, which have all weakened over the last few days against the Pound.
The Australian Dollar has struggled against the US Dollar and with the Federal Reserve expected to raise interest rates on Wednesday this could see further problems for the AUD, as this is likely to encourage global investors to sell off riskier currencies in favour of moving money in to the US Dollar.
Brexit uncertainty continues to hold back the Pound
As the Brexit saga continues, the Pound has not made any real gains against the Australian Dollar and may struggle to do so until we get a clearer resolution as to what may happen in the weeks ahead.
With Theresa May surviving the no confidence vote last week she has yet to get further negotiations going in terms of offering a second Brexit deal which is due to be voted on 14th January. We could see a lot of uncertainty during the festive period so it is important that you’re well prepared for every eventuality in the next month.
At the moment the House of Commons do not appear to be in favour of a Brexit and even if another deal is offered next month I think the chances of this getting through appear to be very limited.
If this does happen and the deal is voted against then I think the UK will be running out of time to get a deal done and may even be left with the choice of a ‘no deal Brexit.’ However, in my personal opinion I think we could see the Government potentially even look at revoking Article 50, which is something they are allowed to do prior to the end of the two year period which is at the end of March 2019.
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