Pound sterling in powerful advance against the Australian dollar, pair could yet march higher says one analyst

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Category: Australian Dollar News

Written by Sam Coventry

International Money Transfers at our sister site

"Sterling enjoyed some easy gains last night as the aussie dollar suffered some very poor Australian unemployment numbers" - Richard Driver at Caxton FX.

The pound to Australian dollar exchange rate is 0.8 pct in the blue this morning at 1.5246.

What analysts are describing as an 'awful' set of Australian jobs data is to blame; the result is the pound has bounced by well over a cent.


"Sterling enjoyed some easy gains last night as the aussie dollar suffered some very poor Australian unemployment numbers. The aussie labour market shrank by 27k jobs in June, whilst the unemployment rate rose back up to 5.2%. Clearly this is an important development and together with slowing Chinese growth, it improves the case for another rate cut from the Reserve Bank of Australia," says Richard Driver, a currency analyst at Caxton FX.

Caxton believes the Australian currency could suffer further from last night’s weak data today, which could take this pair higher from current levels just above 1.52.

Elsewhere, the New Zealand dollar weakened off last night as Asian equities suffered another awful session and NZ data was poor.

No doubt the falling Australian dollar will also have exerted some pull on its smaller neighbour.

The Asian markets responded negatively to the absence of QE3 clues from the Fed last night, so regional risk appetite was very limited. A gauge of NZ manufacturing also showed a very weak number last night.

"This pair has climbed back up to the 1.96 level this morning and weak global risk appetite should continue to lend support to the pound," says Driver.