Australian Dollar Volatile as it Awaits Labour Force Report as GBP Rises on BoE Rate Cut Bet Reversal

GBP AUD Gains, but Traders Await Economic Data 

Today will be an important day for the Australian dollar as it awaits its labour force report which is due later today. Recent dovishness from the Reserve Bank of Australia (RBA) has seen the Aussie suffer of late, and with the pressure piled on from the recent bushfires, the AUD investors will be hoping that the labour data can provide something for a turnaround. The Australian dollar has also been hit with the worries of the Coronavirus which has spread from China, investors are worried that it could have similar effects of the SARS virus in 2002-3. Meanwhile, the GBP is gaining on many of its rivals including the AUD as the Bank of England (BoE) rate cut likelihood has started to decrease after positive labour market reports. The UK will await its PMIs which are due on Friday to determine the path forward for the GBP.

AUD Could Suffer Unless Labour Market Data is Positive, but Predictions Suggest Otherwise

The Australian Dollar has had a recent bad run, with the bushfires which put a strain on an already overbearing Aussie economy, the currency now has its labour market data up for release later today. Investors will be hoping that the report will be in favour of the AUD and can allow it to work its way back up in the market. But expectations do not appear to be along the same lines as the investors. Therefore, volatility is to be expected in the AUD until the report is released. The impact the report could have on the upcoming Reserve Bank of Australia’s interest rate policy is what is driving the volatility. A positive result could fend off a potential cut from the central bank, whilst negative results may add further pressure and increase the chance of a rate cut occurring for Australia in Q1.

GBP Hits New 2020 High as BoE Rate Cut Probability Is Reversed After UK Labour Market Data

Sterling is performing well this week after a recent successful run of labour market data. The data released earlier this week saw a rise in employment and wage growth figures which met expectations. With the employment figures being at its highest ever level, the UK economy looked to be on the mend and thriving. Despite recent Bank of England rate cut bets reaching nearly a 70% chance, the currency looks to have fended off these high percentages and makes way for more gains in the coming weeks. This is of course if the flash PMIs for the UK are positive, they are set to be released on Friday and will be the next major data release for the UK.

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