The Australian Dollar Pound (AUD/GBP) exchange rate initially struck a new six-week high on Thursday as the pairing was lifted by a jump in commodity prices
Australian Dollar (AUD) Bolstered by Surge in Metal Prices
The Australian Dollar struck higher during the Asian session on Thursday as the currency was lifted along with other commodity-correlated currencies by a jump in oil and metal prices during the Christmas trade period.
The jump has seen oil push back over $60 a barrel, while also edging up gold, copper and other metals.
The rise in commodities has largely been driven by low global volatility during the pause between Christmas and New Years and a weakened US Dollar, making those commodities prices in USD more attractive.
However slightly denting the Australian Dollar’s push higher was the lack of a corresponding jump in iron ore prices, with the key Australian export failing to be lifted by the broader rise in commodities as Chinese steel prices continued to tumble this week as construction activity slows during the winter months.
Pound (GBP) Rallies on Mortgage Data
Despite its early losses the Pound was able to rally against the Australian Dollar at the start of the European session as markets reacted to the latest UK mortgage figures.
According to data published by the British Bankers’ Association (BBA) UK mortgage approvals slipped from 40,417 to 39,507 in November, underperforming compared with economists’ forecasts.
However the data was still able to prompt an uptick in Sterling as it revealed that year-on-year the value of mortgage lending had risen 9% in 2017.
Eric Leender, Managing Director of Commercial and Personal Finance said;
‘Increasing numbers of first-time buyers, low interest rates and a competitive marketplace have helped build up mortgage activity through the year, with gross lending standing at nine per cent higher than at the same point in 2016.’
AUD/GBP Forecast: Manufacturing PMI to Weaken Australian Dollar?
Looking ahead the AUD/GBP exchange rate may be able to tick higher again on Friday as a lull in data for both currencies leaves them susceptible to outside influences, with another lift in commodity prices likely to aid the pairing.
However looking to next week the Australian Dollar may be forced to retreat slightly at the start of the session with the release of Australia’s latest Manufacturing PMI with analysts forecasting that domestic factory activity will have slipped in December.
Meanwhile the UK will publish its own Manufacturing PMI next week, which expectations of a possible uptick in activity likely to strengthen the Pound.