A busy week for us with AUD buyers off the back of the RBA's decision to cut interest rates last week. The following report looks at factors that may impact AUD further this week.

Aussie Dollar suffers a double blow last week

The trading floor here at currencies.co.uk was very busy in the early hours of Friday’s trading session, as Aussie Dollar sellers suffered a double setback last week with the currency devaluing quite substantially.

It started on Tuesday (the 3rd of May) with the RBA announcement of an interest rate cut of 25 basis points to a record low of 1.75%. This moved GBPAUD levels up as high as 1.9405, the highest they had been for just over 2 months, which would explain the large volume of client enquiries.

Then on Friday there were further suggestions of another rate cut in the short term future and this once again drove up the value of Sterling against the Aussie, with the pair this time breaching 1.9600, offering clients some great entry levels that many wouldnt have expected this close to the EU Referendum.

If you would like to discuss the news sensitive relationship between this particular pair, and how last week’s wildfire in Canadas oil producing province of Alberta could affect the exchange rate, feel free to get in contact with your assigned broker as there are numerous outside influences currently weighing on the GBPAUD pair.

The week ahead for the Australian Dollar

Exchange rates including AUD could be moved this week off the back of news releases both out of Australia as well as from the news releases of regions nearby.

I think Chinese Trade Balance figures out of China at the beginning of the week could have a strong impact on AUD due to the fact that China is Australias largest trade market. The ANZ Job Advertisements indicator will offer a snapshot of the employment market; this figure is also out at the beginning of the week’s trading session.

Wednesdays Westpac Consumer Sentiment data release could be of significance as consumer confident is closely linked with consumer spending.
RBA Assistant Governor Malcolm Edey will be giving a speech on Wednesday, which is expected to be more hawkish than bullish; this could once again negatively impact the Aussie Dollars value.

Finally, Thursday sees the release of MI Inflation Expectations, which will offer an indication of analysts expected inflation figure for April. This figure came in at 3.6% in March, so expect market movement if this figure comes out below analysts’ expectations.


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