Sterling falls below 1.80 against the Australian Dollar
Pound to Australian dollar exchange rates fell back below 1.80 overnight, with the pound hitting a low of 1.7989 on the interbank exchange. Whilst the pound found enough support to push back above this key threshold, it has fallen away from last week’s highs of around 1.82.
Pound volatile to Brexit developments
Sterling has come under pressure across the board following Prime Minister Boris Johnson’s decision to suspend parliament for up to five weeks in the run up to the 31st October Brexit deadline. His decision has been met with widespread anger, causing a huge amount of unrest in Westminster and across the entire UK. Tens of thousands of protesters took to the streets of London and other cities across the UK over the weekend, demanding that Johnson reverse his decision.
The EU’s chief negotiator Michel Barnier also made a statement, in which he reiterated Brussels position on the much maligned Irish backstop, which will not be scrapped. With MP’s desperately looking for ways to stop Mr Johnson’s motion to shut down parliament, it is likely this story still has legs in it and as such the Pound could be set for a further period of volatility against the AUD.
Australian economic news
Looking at the Australian economy, which is facing an extended period of slow growth according to the Reserve Bank of Australian (RBA) and it is clear that they are facing a unique of set of economic themselves. Concerns over a slowdown in global trade and a slowdown in Chinese demand for Australia’s export of raw materials, has caused the RBA to lower economic growth forecasts for the remainder of 2019 and 2020. This dovish outlook is likely to remain for the foreseeable future and as such, the AUD could find life tough coming over the coming months.
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