Australian Dollar Outlook Remains Challenging: "GBP/AUD moved from an overnight level of 1.73 to gain almost a cent to 1.7390"
The outlook for the Australian Dollar (Currency:AUD) remains challenging; "the commodity linked AUD and NZD currencies also fell heavily as the positive data from the US bolstered economists’ predictions that US stimulus measures will be tapered in September," says James Mills at UKFore.
A look at the foreign exchange markets in late Friday in London shows:
- The GBP/AUD is 0.06 pct lower than seen at Thursday night's closing level; GBP/AUD is quoted at 1.3755.
- The EUR/AUD exchange rate is 0.05 pct lower at 1.4824.
NB: The above are spot market quotes, your bank will subtract their own spread when passing their retail rate. However, an independent FX provider will guarantee to undercut your bank's offer, thus delivering you more currency. Please learn more here, or use our custom live wholesale vs retail currency converter.
Pound Sterling tipped to continue gains
James Mills at UKForex says he continues to back the British Pound against the Aus dollar:
"GBP/AUD moved from an overnight level of 1.73 to gain almost a cent to 1.7390 however the gains could have been more if overnight Private Sector Credit from Australian hadn’t shown an improvement from expected levels.
"GBP/NZD gained over two cents from 1.98 to above 2 as a lack of data did little to halt the Kiwi’s losses. This morning’s positive figures from the UK could see sterling continue these gains and any positive Personal Income and Consumption data from the US could further back the view that the Federal Reserve will begin tapering. We open with GBP/AUD at 1.7350 and GBP/NZD to 1.9930."
However, Sash Nugent at Caxton FX says:
"The UK parliament rejected the Prime minister’s proposal to intervene in the disruption in Syria, reducing worries about potential military action in Syria. This has benefitted the Aussie, preventing the GBPAUD rate from rising further."
Bearish Australian Dollar versus the US Dollar
Turning to the main Aus vs US Dollar exchange rate we note analysts continue to maintain a bearish outlook towards the AUD.
Luc Luyet at MIG Bank says:
"AUD/USD continues to be trapped between 0.8848 and 0.9221 (05/08/2013 low and 19/08/2013 high). A decisive break under 0.8848 is required to reignite bearish sentiment. Until this key level is overcome we cannot rule out the possibility of a return to and break back over 0.9221.
"In the longer-term, the break of the strong support at 0.9388 (04/10/2011 low) opens the way for a further medium-term decline, whose potential downside risk lies near the key support at 0.8067 (28/05/2010 low).
"However, we keep in mind that if the key resistance at 0.9345 were to be broken, we would have to reassess our outlook."
Gareth Berry at UBS says:
"With the trending/momentum indicators pointing lower, focus is on support at 0.8848, a break below which would expose 0.8545. Resistance is at 0.9070
ahead of 0.9233."
Emmanuel Ng at OCBC says:
"Despite a much better than expected reading from 2Q capital expenditure numbers, the AUD-USD failed to maintain above its initial move above 0.8950, with the pair eventually settling lower in line with the other majors. We continue to char t a top heavy trajectory for the near term with an initial base expected towards 0.8850/75."