On Thursday, as investors awaited news on GDP growth, the Pound Australian Dollar (GBP/AUD) exchange rate was supported by expectations that the UK would avoid a recession.
The GBP/AUD currency rate is now around $1.7455, up 0.52% from this morning’s opening prices.
Increase in Risk Appetite Supports Pound (GBP) Exchange Rates
In contrast, the Pound (GBP) had a mixed day on Wednesday due to the lack of significant economic data.
The status of the UK economy has also been a source of increasing optimism, with HSBC expressing confidence that the future is not as dire as anticipated. In contrast to its bleak November prognosis, which was predicated on much higher energy costs, the Bank of England (BoE) now anticipates a shorter, milder recession. Instead of contracting 2.9% over the following eight quarters, the UK economy is now predicted to shrink by over 1% over the following five.
Naturally, the public will anticipate such from us. Naturally, I would anticipate the people to respond, “It’s your responsibility to bring inflation down to goal,” to which I would reply, “Yes, it is, and we will do it.”
Despite improved risk sentiment, the Australian dollar (AUD) exchange rates are under pressure.
The Australian Dollar (AUD), which on Wednesday fell versus a higher Sterling, struggled to maintain its initial gains.
Market mood dramatically improved as a result of the US Dollar falling due to the Federal Reserve’s decreased rate rise predictions.
Hopes that the People’s Bank of China (PBoC) would lower interest rates even further in Q2 are one more thing that modestly supports the “Aussie.” The Australian dollar (AUD) may gain support elsewhere due to increased anticipation that the Reserve Bank of Australia (RBA) would keep up its aggressive rate rises.
Forecast for the GBP/AUD exchange rate: Will the UK GDP growth rate boost the pound further?
Looking forward, the announcement of UK GDP statistics may cause the Pound Australian Dollar exchange rate to move more quickly. Despite not growing, an anticipated QoQ standstill might demonstrate that the UK avoided a recession. However, a predicted MoM contraction might make people feel down.
The issuance of the RBA’s monetary policy announcement might cause the Australian Dollar to move further.