Australian Dollar gains ground on Sterling: Politics weighs on the Pound and Australian data generally positive

Australian Dollar gains ground on Sterling Politics weighs on the Pound and Australian data generally positive

Sterling weakens against the Australian Dollar as political uncertainty continues

The Pound to Australian dollar interbank rate has dropped into the 1.78s in morning trading, which is a loss of almost 1%. Sterling has weakened a little against all major currencies due to concerns as to how the political issues the UK are facing may work out, with today being very important for Prime Minister Boris Johnson.

He may face a vote of no confidence which in turn could then ultimately lead to him calling a snap general election, all of this is leading to political uncertainty which is one of the factors that can weigh heavily on a currency.

Reserve bank of Australia holds interest rates

In Australia we had mixed news but overall the economic data has been viewed as positive for the Australian dollar. Interest rates remained on hold at 1% which was widely expected, but what was most impressive for the Australian dollar last night was the news that the Australian current account had a surplus for the first time since 1975, news that has been touted as a historic day for the Australian economy by economists at Westpac.

It is thought that the rising commodity prices has played a big role in this surplus and this has given the Australian dollar a healthy boost.

The only slight grey cloud to overshadow the Australian dollar was a slight drop in retail sales figures for July, figures came out at -0.1% but in all honesty the other news posted earlier in this report will most likely be taken more seriously by investors and speculators alike so we could see a good few days for the Australian dollar off the back of it.

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