The GBP AUD exchange rate starts the week around the 0.8620 level after a week trading between that level and 0.8400. The pair will now look for a catalyst to start a new trend. An emergency UK cabinet meeting over the weekend with reports of imminent lockdowns could be the deciding factor for the pair.
The GBP AUD exchange rate had tested the 1.8620 price level after the BoE rate rise last week.
Australia sees record surge in cases after border reopenings
Australia has seen a record surge in virus cases after state rules were eased.
The 2,842 cases in New South Wales were the highest daily cases since the beginning of the pandemic and comes despite the state having a 95% vaccination rate.
“The omicron variant likely accounts for the majority of the latest cases and people should get booster shots as soon as they’re eligible,” NSW Health said in a statement.
Still, in a state of more than 8 million people, only one death was recorded.
Prime Minister Scott Morrison reiterated at the weekend that ‘living with the virus’ is not about case numbers.
“We’ve been planning for this. We planned to live with the virus,” Morrison said at a press conference. “We didn’t plan to remain shut in.”
His statement comes after the treasurer also pleaded with premiers to remain open with the latest jump in cases.
We will see in the weeks ahead whether Australia plans to really live with the virus, or whether they will backtrack. The pound sterling versus the Australia dollar will depend a lot on the answer.
UK also living with lockdown fears after emergency cabinet meeting
The pound sterling could be weighed early in the week after Boris Johnson called an emergency cabinet meeting, which is said to have prepared ministers for further restrictions.
Reports have suggested that officials are making plans for a two-week circuit breaker lockdown after Christmas.
The latest calls for restrictions come from the government’s SAGE advisory group, with scientists telling ministers that more stringent measures need to be brought in “very soon”.
Stephen Reicher, a member of SAGE said to the Radio Times that the time to act was now.
Prof Reicher said, “all the science suggests that Plan B is not going to be enough”.
“In many ways, the most effective way of diminishing contact is to have a circuit-breaker.”
“Now, you could have it after Christmas, the problem is after Christmas it’s probably too late, it’s probably by then we will have had a huge surge of infections with all the impact upon society.”
The latest talk suggests that the scientists are now pressuring the government to add further restrictions and the UK economy, the fastest-growing in the G7, will be derailed once again.
However, a YouGov survey found that a majority of people would not back pubs, restaurants or non-essential shops being shut or limits on meeting people from other households.
Pound Sterling Forecast – Powered by Lumon