GBP AUD Pauses After Two Day Data Rally

GBP AUD Hesitates as Traders Weigh Up Virus Path

The GBP AUD exchange rate was flat on Thursday after a strong two-day rally in the British pound after employment and inflation data. Both data sets increased the chances of a rate hike for the UK In December. A headwind for the UK is coronavirus rates once again as Europe talks lockdowns.

The GBP AUD exchange rate was trading at 1.8540 ahead of UK consumer confidence figures.

GBP AUD could be set for another coronavirus reversal

Australia has finally eased its latest bruising lockdown and now the threat is on the UK as the winter weather approaches.

European is seeing another wave of cases and is talking about lockdowns once more with Germany and Austria leading the charge with lockdowns for the unvaccinated, but the latter is considering a full lockdown. There was also talk yesterday that Boris Johnson could add an unvaccinated restriction set in the UK.

Further restrictions could suck the wind out of the latest pound sterling interest rate-driven rally.

Meanwhile, Melbourne has lifted capacity restrictions on pubs and restaurants. The state is also allowing stadiums to return to full capacity as restrictions for the vaccinated ease. Measures to halt the spread of the virus have been eased as the population of reaches two-dose vaccination rates of 70%, 80% and 90%.

Victoria Premier Daniel Andrews said: “Your life will be back to normal you will be able to enjoy all the things that you have yearned for and missed.”

Australia have been behind the curve on vaccines and are reopening on high vaccination rates despite the fact that the whole of Europe has already done this and are now backtracking.

Australian politicians facing heavy threats

Victorian crossbench MP Fiona Patten had the following to say of protests in the country:

“I was walking down the street the other day and someone had tagged a sign that said, “Hang Dan Andrews.” I don’t remember a time in Australia’s history where we’ve talked of killing our political leaders …

On Saturday’s protest, there was three nooses hanging off a mock gallow, reflecting the three crossbenchers. We’ve never seen anything like this. I’ve been having threats of snipers outside my office …

We’ve certainly seen an increase in security around the building. These people are saying they’re fighting for democracy … but because of all of these threats, we’ve had to close the parliament to the public.”

In Austria, police and military joined a protest against the latest lockdown measures.

Markets have not priced in the potential for civil unrest, but another round of lockdowns seem to be on the way and that could infuriate a lot of people after the vaccine drive and their diligence over the last year and a half.

The pound sterling found a base after the economic data this week and will aim to advance as we approach the mid-December BoE rate hike meeting. The path of the virus will have a bearing on that.

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