AUD Continues Bullish Run Following Global Virus Slowdown

AUD Continues Bullish Run Following Global Virus Slowdown

The Australian dollar’s bullish recovery stayed in-tact during yesterday’s trading, edging 0.7 per cent higher against the pound. GBPAUD is now trading at 1.92 compared to 2.05 earlier this month. A global slowdown in Coronavirus case numbers and fatalities, particularly in Europe has helped improve market confidence, boosting the risk based Australian dollar. The Aussie dollar has also benefited from news that the Australian government will relax some of the current lockdown measures.

The Coronavirus curve looks to be flattening in Australia and new cases are at a low however government officials are warning that a second wave of the virus could cause cases to spike if the public do not stick to the restrictions and social distancing measures. Restrictions that pose a limited threat such as a recreational drive, having a picnic, sitting on the beach or visiting a shop for non -essential items, will be removed first, but businesses such as restaurants and bars will remain closed.

In addition, the commodity-based currency gained support from the rally in copper prices. Australia, being an exporter of the metal, welcomed China’s effort to increase stock. China’s industrial profits plummeted 34.9 per cent Year on Year, but the Aussie ignored this negative data as risk dominated.

Boris Discusses Exit Plan

In the UK, Prime Minister Boris Johnson returned to office, apologising for his absence and thanking the country for respecting the social distancing measures. Johnson added that he thought the UK was past its Coronavirus peak but warned of maximum danger if lockdown restrictions are eased too soon.

Preparations for phase two of the plan have already commenced and Johnson confirmed he would seek cross-party support for the exit plan. The prime minister is keen to get the UK economy going but will proceed with caution as he does not want to undo all of the good work done to date and risk a second wave of the virus. There has been no confirmed date for when Johnson will announce his exit plan, but more information will be given over the coming days.

The government has a lot to think about as it weighs up the human consequences versus the economic consequences and attempts to map out a way forward.
Suggestions are that modifications to the current lockdown will take place first, followed by the lifting of other restrictions, providing the Coronavirus number stay low.

Get in touch to discuss your upcoming GBPAUD currency exchange, and how it could be impacted by these factors in the coming weeks. I’ll be happy to get in touch personally and discuss your enquiry.