The GBP/AUD price was little changed on Tuesday morning as the market reacted to the latest economic data from the UK and Australia. The GBP to AUD exchange rate is trading at 1.7315, which is about 2.80% below the highest point in June.
BoE and RBA convergence
The GBP/AUD price has been in a strong bearish trend in the past few weeks after the hawkish change of tune by the Reserve Bank of Australia (RBA). The bank has hiked interest rates three times this year and hinted that it will continue with the process to fight the soaring inflation.
Now, it seems like these actions are having an impact as mortgage rates soar. Data published Monday revealed that mortgage rates in places like Sydney, Melbourne, and Brisbane dropped sharply in June. Indeed, Sydney’s crash was the worst performance in over 20 years. Sadly, there is a likelihood that the situation will continue in the coming months.
The GBP to AUD price also retreated after last week’s important economic data from the UK. The numbers revealed that the country’s unemployment rate remained at 3.7%, which was a sign that the labour market was doing well. Additional data showed that inflation soared to 9.4%, the highest level in over three decades. Retail sales declined sharply as concerns about prices remained. Still, analysts expect the Bank of England to hike by a bigger margin in the coming meeting.
GBP/AUD forecast
The four-hour chart shows that the GBP to AUD exchange rate has been in a tight range in the past few days. The pair remains slightly below the 25-day and 50-day moving averages. It has also moved below the ascending line shown in blue, while the Relative Strength Index (RSI) has moved to the neutral point at 50.
Therefore, the pair will likely resume its downward trend in the next few days. If this happens, the next key level to watch will be at 1.7200, which was the lowest point this year. A move above the resistance at 1.7360 will invalidate the bearish view.
