- COVID-19 surge in Victoria continues – 75 new cases
- China has approved a new vaccine for military use
- New round of post Brexit trade talks begin
- Pound-Australian dollar exchange rate fell -0.61% last week
GBP/AUD was down by 58 pips (-0.31%) to 1.7919 as of 4pm GMT.
The currency pair tested 1.80 in early trading but quickly tumbled back to 1.79 before stabilising lower on the day. The exchange rate has now fallen eight of the past nine weeks.
GBP: Johnson: “We have seen a big fall in GDP”
Brexit concerns dragged on Sterling again as UK negotiators headed over to Brussels what has been dubbed a new ‘intense’ round of talks. The hope is that these talks can draw a new outline in which both sides can agree- setting up more detailed discussions in July through September.
Although the cases in the United Kingdom remain much higher than in Australia, the trajectory has shifted slightly in the past few days. The UK is on course to reopen pubs on July 4th, while the Australian state of Victoria experienced 75 new cases in the last 24 hours, up from zero a week ago.
UK Prime Minister Boris Johnson made some remarks about the difficult state of the UK economy, saying “We cannot just step back on the economy now.” Adding; “We have seen a big fall in GDP” and that “Everybody must go back to schools in September.”
AUD: China approves a coronavirus vaccine for military
The approval of a new vaccine for COVID-19 called ‘AD5-nCoV’ for military use in China offered some hope that a vaccine is getting closer, helping a turnaround in ‘risk trades’ including the Australian dollar. The new vaccine would not be available to the general public until further government approval.
The Australian dollar held up against the pound but looked soft against havens like the dollar after having its 4th worst day for rising cases since the beginning of the pandemic and the highest number of new cases since April 10.