GBP to AUD Rate since 2 years and a half

The GBP / AUD exchange rate continues to rise, after crossing the 1.88 GBP / AUD range, as Brexit developments have a significant impact on the exchange rate. GBP to AUD rates are now at their highest level in two and a half years, providing a good opportunity for those looking to buy Australian dollars. Last night, the British government was overthrown by a vote that eliminates the possibility of a hopeless Brexit.

Will Parliament vote for an extension of Article 50?

Parliament will debate and vote today on another proposal to delay Article 50, which will require prior authorization to defer Brexit. Markets have now begun to anticipate their prices in the prospect of a milder Brexit or likely to be delayed for a long time. The underlying question is how long it would take to make a final decision on Brexit. Whether or not this demand is granted by the EU, this will also create additional volatility for GBP to AUD rates.

As such, it really depends on the offer of the EU, which means that all options are open, including the possibility of a Brexit without agreement. There is now so much uncertainty over the past few weeks that one should expect a high volatility of the GBP versus the AUD. Any developments over the next few days should lead to a sharp rise in the pound sterling and another constructive vote next week will invariably lead to increased volatility in the exchange rate from GBP to AUD.

Australian economic data disappointed

The Australian dollar is also suffering from a contraction after the loss of consumer confidence, disappointing markets, along with a reduction in housing finance. The Australian real estate market remains very current at the moment, after recording a sharp drop in prices in most major cities, including Sydney and Melbourne. The real estate market is often one of the first sectors to retreat before a larger economic downturn that does not boost confidence in the Australian dollar.

While commodity prices have risen this week, which would normally be considered positive for the Australian dollar, the more general question of the prospect of falling trade between China and Australia seems to be a motive of greater concern. Chinese growth has deteriorated sharply with the reduction exacerbated by the ongoing trade war between the United States and China.

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