Pound sterling plumbs lower against Australian dollar but one analyst sees a recovery from here

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Category: Australian Dollar Articles

Published on Friday, 15 February 2013 11:40

Written by Sam Coventry

The Australian dollar (Currency:AUD) continues to face mixed fortunes on the global FX space. A look at the wholesale market rates shows:

The pound / Australian dollar exchange rate is 0.06 pct in the blue at 1.4967.

The euro / Australian dollar exchange rate is 0.18 pct lower at 1.2878.

The Australian dollar / US dollar exchange rate is 0.07 pct in the red at 1.0352.

NB: The above quote is taken off the wholesale markets - your bank will charge a discretionary spread to the figure. An independent FX provider will however guarantee to beat your bank's offer, thus delivering you more currency. Please find out more here.

Sterling to recover against Aus Dollar?

The pound plumbed lower levels against the AUD but could recover from here says currency analyst Richard Driver at Caxton FX.

Live Charts and Aus Exchange Rates
Exchange Rate Forecasts 2013: USD GBP EUR AUD NZD JPY CHF CAD SEK NOK

"An RBA policymaker reminded the market that Australia’s mining boom is likely to peak this year, which always gives the market something to think about. We still have our concerns over the rest of the economy’s ability to pick up the slack left by declining mining investment, regardless of the recent strong aussie consumer sentiment figure. This pair trades at 1.50 and we may see GBP head higher within its range from here," says Driver.

Key events for the Australian dollar next week

In Australia, the Minutes from the February RBA Board meeting - where official interest rates were left at 3.0% - will be released on Tuesday.

On Friday, RBA Governor Stevens will give his semi-annual Testimony in Canberra.

In regard to data, the key release to watch will be Q4 wage price index which is out on Wednesday and is likely to be a little higher, in part a ‘payback’ for the relatively weak Q3 outcome.

In New Zealand, RBNZ Governor Wheeler speaks on Wednesday, while Q4 producer prices, January ANZ job ads and credit card spending are published over the course of the week. Job advertising trends will be closely watched given recent weak employment data.

New Zealand dollar remains on the offensive

Data from the fourth quarter of 2012 revealed that NZ retail sales growth picked up by 2.1%, the best figure since the same time a year ago.

"The market doesn’t seem to need much of an excuse to pile into the NZD at the moment but this is just another factor that will put this pair under pressure," says Driver, "sterling is trading down around 1.82 and more losses look to be on the horizon."