The British pound is higher against the Australian dollar on Friday.
- US jobs surprise sends markets flying
- More face-to-face negotiations offer Brexit hope
- Australia signs military agreements with India
- Sterling-Aussie exchange rate falls -1.80% this week
GBP/AUD was up by 50 pips (+0.29%) to 1.8190 as of 4pm GMT.
The currency pair double-bottomed at 1.807 and edged back into positive territory for the day, briefly topping 1.82 before pulling back.
GBP: Trade deal negotiations to continue
The pound will end the week lower against the Australian dollar for a fifth consecutive week, but there were some early signs of a recovery on Friday. That was in large part because the post-Brexit trade talks ended on friendlier terms than on prior occasions, with the UK side committing to further discussion to end the deadlock.
UK Chief Negotiator David Frost said “Progress remains limited but our talks have been positive in tone. Negotiations will continue and we remain committed to a successful outcome.” Importantly he also said he would have extra face-to-face meetings to get past the key hurdles holding back a deal.
The more positive tone to the negotiations sets up the EU summit in just over a week, where hope is rising Boris Johnson can scrape out another last-minute compromise like achieved with the ‘withdrawal agreement.’
AUD: Australia strengthens military ties with India
The Aussie dollar was giving back some weekly gains against the pound but elsewhere looked firm – regaining the key 0.70 figure versus the US dollar (AUD/USD).
Australia and India signing two new bilateral military agreements complicates Australia’s already frayed political relationship with China. Still, investors judged it needn’t pose any immediate threat to the Australian currency, which is moving higher amid global re-opening hopes, which received a massive boost from the biggest positive surprise in the history of the US jobs report.
Data out today was expected to show the US unemployment rate had risen to nearly 20% but instead- jobs were created in May and the rate of unemployment unexpectedly fell.
