The Australian Dollar Pound (AUD GBP) exchange rate continued climbing on Tuesday as China’s manufacturing sector reported an improvement in December.
Australian Dollar Pound (AUD GBP) Bolstered by Growth in China
The Australian Dollar surged on Tuesday following the release of China’s Caixin Manufacturing PMI, which reported a surprise improvement from 50.9 to 51.9 in December after analysts forecast it would remain unchanged.
The news helped to improve market risk appetite as the rise in production is likely to increase demand for commodities, causing a notable uptick in the high-yield ‘Aussie’ thanks to Australia’s position as a key trading partner of China.
Manufacturing Data Provides Brief Rally for Pound (GBP)
The Pound was able to mount a brief recovery on Tuesday, curtesy of its own Manufacturing sector as the latest PMI report showed that production surged from 53.6 to 56.1 in December, beating expectations that it would fall to 53.3 and reaching its highest levels since June 2014.
However, Sterling was unable to stabilise at its best levels and quickly fell again early on Wednesday morning as economists predicted that a decline in consumer spending is likely to prevent the growth from being sustainable.
AUD GBP Forecast: UK Construction Data may Bolster Sterling
The AUD GBP exchange rate may slide later today following the release of the UK’s latest Construction PMI, which could provide a boost for the Pound, should it perform similarly to yesterday’s manufacturing report.
Meanwhile The Australian Dollar may slide later today following the release of AiG’s Services Index which is expected to fall from 51.1 to 50.2 to December.
The ‘Aussie’ may also suffer at the hands of the US Dollar (USD) as optimism toward President-elect Donald Trump causes the ‘Greenback’ to pressure AUD in the run up to his inauguration later this month.
Current Interbank Exchange Rates
At the time of writing the AUD/GBP exchange rate was trending around 0.59 and the GBP/AUD exchange rate was trending around 1.69.