The British pound is flat against the Australian dollar on Friday.
- Australian dollar gives up daily gains after US-China trade deal review delayed
- UK adds France, Netherlands to quarantined list after outbreak
- Risk sentiment sours over future of US stimulus
- Trump touts direct checks to Americans
GBP/AUD was up by 3 pips (+0.01%) to 1.8267 as of 4pm GMT. This week the pound-aussie dollar exchange rate rose by +0.14%.
The currency pair fell from a weekly high late Friday, it spent most of the week trading between 1.82 and 1.83 in directionless trading.
GBP: UK adds France to quarantine list
The British pound had been higher early on Friday surrounding hopes for next week’s Brexit talks and with the Aussie dollar trending lower since the New Zealand central bank raised the prospect of looser monetary policy to combat rising virus cases.
Additional travel restrictions imposed by the UK for European countries including France beginning Saturday weighed on European stock markets – and will be a drag on both UK and European tourist industries. Travellers coming back from those counties will have to quarantine for 14 days, creating a furry of demand for flights returning to the UK before the deadline.
The pound had also seen something of a rebound since the midweek slump following the UK GDP figures. The -20.4% Q2 UK GDP decline however still hangs over the British currency as the worst quarterly decline amid developed countries. Additionally the rise in UK joblessness in July raises the chance of much steeper layoffs when the government furlough scheme ends in October.
AUD: US China trade delayed
The Aussie dollar saw a bout of short-covering at the end of the week, helped on by some wider uncertainty in markets. Congress have not yet agreed a second stimulus bill and so US President Donald Trump may be nearing a second set of executive orders including a direct payment to American families.
Adding to the confusion was the sudden cancellation of the review of the US China trade deal. The trade review scheduled for tomorrow has been delayed, presumably because of the deteriorating relations between the two nations.
