GBP/AUD is confidently advancing on Thursday.
Currently, the pair is trading at 1.9291, up 0.30% as of 6:55 AM UTC. Yesterday, the rate has broken the upper line of a symmetrical triangle, suggesting that the bullish mood might last for longer.
GBP/AUD: AUD down amid worries about the coronavirus outbreak
The main cause behind the Aussie’s decline is the fresh worries about the coronavirus outbreak in China – Australia’s largest trade partner and the world’s biggest economy after the US.
After implementing a new method of diagnosis, China province of Hubei reported today 14,840 new cases of the virus as of February 12. This is about nine times more than the 1,638 new cases reported on Tuesday. The daily number of deaths in the region rose to a record 242, bringing the total to 1,310.
China replaced two top officials in Hubei shortly after the new figures came out. Until Wednesday surge in new cases, the number of people diagnosed in Wuhan, the capital city of Hubei, seemed to stabilize. The Australian dollar, along with other Asian currencies, was looking more confident until yesterday.
Earlier today, Australian Prime Minister Scott Morrison said that the country would extend the entry ban on visitors from mainland China for another week. The measure will be reviewed each week. Australia has 15 cases of the coronavirus, though no new cases have been recorded since the travel ban.
GBP/AUD: GBP boosted by positive housing market data
Elsewhere, the British pound is supported by recent housing market data released by the Royal Institution of Chartered Surveyors’ (RICS). The house price index increased to +17 last month from -2 in December, which is the highest reading since May 2017. The RICS’ data is another sign of improving consumer sentiment.
RICS chief economist Simon Rubinsohn commented:
“It remains to be seen how long this newfound market momentum is sustained for, and political uncertainty may resurface towards the end of the year. But at this point in time contributors are optimistic.”
The UK economy enjoys some boost in sentiment after the December election won by Prime Minister Boris Johnson. While Britain managed to leave the European bloc, it has to reach a trade agreement by the end of the year, and the uncertainty might show up again due to major divergences.
Earlier today, French Finance Minister Bruno Le Maire told media that France would make sure all goods entering the EU from the UK comply fully with European standards.
