The Pound to Australian Dollar (GBP/AUD) exchange rate remained stable after the release of manufacturing PMIs for both the UK and Australia. The week started with the Pound (GBP) showing limited movements due to a lack of impactful macroeconomic data. However, on Tuesday, Sterling faced volatility as unemployment unexpectedly rose. Midweek trade saw subdued movements in the Pound following the release of the latest UK GDP growth rate. On Thursday, without any significant macroeconomic data releases, the Pound traded without a clear direction [a15faa46].
The Australian Dollar (AUD) began the week on shaky ground after the release of the latest Australian business confidence index. Despite a decrease in unemployment to 4% in Australia, the 'Aussie' weakened against its counterparts due to its risk-sensitive nature [a15faa46].
The UK's manufacturing PMI for June came in at 50.9, slightly lower than the previous reading of 51.2 but still indicating expansion. The manufacturing sector in the UK is experiencing strong growth, with output and new order growth sustained at robust rates. However, weak export performance is a concern. The Australian manufacturing PMI marked the fifth consecutive monthly decline and the fastest pace of decline since May 2020. The manufacturing sector in Australia is facing difficult trading conditions, leading to reduced production and new orders [2e2d3e36].
Looking ahead, the Pound is expected to experience movement driven by a series of impactful data releases. First, the latest UK consumer price index data is set to be published on Wednesday. This will be followed by the Bank of England's interest rate decision. On Friday, the UK's retail sales data for the latest period will be released. For the Australian Dollar, investors will primarily focus on the Reserve Bank of Australia's interest rate decision. The GBP/AUD exchange rate is expected to be influenced by the UK's general election and the Reserve Bank of Australia's meeting minutes. Positive trade could undermine GBP/AUD, while safer assets could strengthen it [2e2d3e36].