Australia enjoyed its best week for a while as it gained nearly 2% against sterling and the US dollar. Although its rise against sterling yesterday was due to weak data out of the UK, the upward trend of the Australian dollar has come as a result of the hawkish comments made in the Reserve Bank of Australia (RBA) statement on Tuesday.
For the first time this year, the RBA decided against a weaker dollar, with the view of increasing interest rates in the near future. This seemed to have a snowball effect as all pivotal data for the rest of the week came out above expectations, barring yesterday’s unemployment rate figure, which was only 0.2% more than expected.
It seems that Australia is turning a corner, unlike their cricket team, and if we hear more hawkish comments out of the RBA monetary policy statement today, we could see the sterling-Australian dollar pairing drop below the 2.1 mark for the first time in two weeks.
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