AUD to GBP jumps to the highest level in July after the release of the RBA minutes. The central bank has a cautious but optimistic outlook while it noted that the global economy is improving. Governor Lowe said, that there is no need to push down the AUD, as the Aussie dollar is trading in line with the fundamentals.
Reserve Bank of Australia (RBA) kept the interest rates unchanged at 0.25%. RBA has cut 17 times the interest rates since November 2011, from 4.75% to 0.25%. With the Australian economy experiencing the biggest contraction since the 1930s, RBA reiterated that it is likely that fiscal and monetary support will be required for some time.
The Aussie GDP contracted by 0.3% in the 1Q marking the first fall in output in th last nine years. The Aussie consumer confidence index fell by 1% to two month low of 92.1 last week. The Australian jobless rate rose from 6.2% to near 19-year highs of 7.1% in May.
In the UK earlier today, the UK government borrowed 34.8 billion in June above the forecasts of 34.3 billion, but below the 45.5 billion borrowed min May. Now the total UK government debt has reached 1.98 trillion.
AUD to GBP Price Analysis
AUD to GBP is 0.61% higher at 0.5576, making the recent ten days high as the pair recover all of yesterday’s loses. The pair broke below and outside the ascending channel that drove the AUD to recent highs. The technical picture is clearly bullish, and the pullbacks should be considered as a buying opportunity.
On the upside, the first resistance for AUDGBP is at 0.5594 the daily high. Next hurdle for AUDGBP will be met at 0.5602 the high from September 9, 2019. A break above would challenge the highs from August 1, 2019, at 0.5672.
On the other side, the immediate support for AUDGBP stands at 0.5538 the daily low. A move below would open the way for a test of the 50-day moving average at 0.5481. If the sellers break that level the next support will be met at 0.5439, the low from June 18.