Read the story here. Advertise at Before It's News here.
Profile image
By Pound Sterling Forecast (Reporter)
Contributor profile | More stories
Story Views
Last hour:
Last 24 hours:

GBP AUD Higher After RBA 50 bps Rate Hike 

% of readers think this story is Fact. Add your two cents.

The GBP AUD exchange rate was 0.44% higher on Tuesday after the Reserve Bank of Australia hiked interest rates by 50bps as expected. The Aussie dollar softened after a weaker than expected PMI services number. The RBA also said that they would be guided by data for future rate hikes 

The GBP to AUD rate was higher but is not troubling the overhead resistance at 1.7800. 

RBA lifts interest rates by 50 basis points to 1.35% 

The Reserve Bank of Australia raised interest rates to 1.35% in the first-ever back-to-back hike of 50 basis points. 

In a Bloomberg survey, only 1 out of 26 analysts expected a different outcome and that tempered some of the gains in sterling. Analysts also felt that the current trajectory for rates is priced in after the bank said that data would guide future rate hikes. 

The central bank’s Governor Philip Lowe stated that although the recent spending data was positive, household budgets are feeling the pressure from rising prices and increased interest rates. He noted that the board will pay close attention to these different influences on household spending while it “assesses the appropriate setting of monetary policy.”  

The RBA are in the same bind as the Bank of England.  Both inflation and higher interest rates pose a threat to disposable income. Australian retail sales were promising for May. With Aussie consumers adding to a fifth-straight month of higher sales. However, the country saw inflation and rate hikes arrive a little later. Future numbers may start to slow down.  

Sales were 0.9% higher in May, which doubled analysts’ forecasts for a fresh record high of A$34.2 billion. 

The country’s treasurer, Jim Chalmers said of the interest rate move that Australia’s people will find the news challenging. He added that it would be a “tough day for a lot of homeowners.” 

More headlines may be on the way after the RBA Governor said in May that it was “not unreasonable” to expect rates to hit 2.5%. 

Australian PMI still expanding, but at a slower pace 

The S&P Global PMI for June in Australia showed the services sector expanded with a reading of 52.6. However, this figure was slower than last month’s 53.2. It may mark the initial signs of cautious spending in hospitality businesses. 

The index is down from highs of 57.4 in February. It risks falling to the January lows around 46 if higher interest rates bite into consumer spending. 

In the UK, the Bank of England warned of a deteriorating outlook for the economy with commodity price volatility. The Russian invasion of Ukraine further exacerbated the price pressures that households and businesses face. There are “implications for the financial system,” the BoE said.  Tighter financial conditions, as well as decreased real incomes, will impact debt affordability for households, businesses and governments across the world, raising the risks from global debt vulnerabilities.  

Around 80% of UK mortgages are said to be on fixed interest rates, but 40% will expire in 2022 and 2023. 

To get in touch and receive further insight into the factors that could impact your overseas payments, click the button below and complete the form on the Lumon website.


The post GBP AUD Higher After RBA 50 bps Rate Hike  appeared first on Pound Sterling Forecast.


Before It’s News® is a community of individuals who report on what’s going on around them, from all around the world.

Anyone can join.
Anyone can contribute.
Anyone can become informed about their world.

"United We Stand" Click Here To Create Your Personal Citizen Journalist Account Today, Be Sure To Invite Your Friends.

Please Help Support BeforeitsNews by trying our Natural Health Products below!

Order by Phone at 888-809-8385 or online at M - F 9am to 5pm EST

Order by Phone at 866-388-7003 or online at M - F 9am to 5pm EST

Order by Phone at 866-388-7003 or online at M - F 9am to 5pm EST

Humic & Fulvic Trace Minerals Complex - Nature's most important supplement! Vivid Dreams again!

HNEX HydroNano EXtracellular Water - Improve immune system health and reduce inflammation

Ultimate Clinical Potency Curcumin - Natural pain relief, reduce inflammation and so much more.

MitoCopper - Bioavailable Copper destroys pathogens and gives you more energy. (See Blood Video)
Oxy Powder - Natural Colon Cleanser!  Cleans out toxic buildup with oxygen! 
Nascent Iodine - Promotes detoxification, mental focus and thyroid health.
Smart Meter Cover -  Reduces Smart Meter radiation by 96%!  (See Video)

Report abuse


    Your Comments
    Question   Razz  Sad   Evil  Exclaim  Smile  Redface  Biggrin  Surprised  Eek   Confused   Cool  LOL   Mad   Twisted  Rolleyes   Wink  Idea  Arrow  Neutral  Cry   Mr. Green

    Load more ...




    Email this story
    Email this story

    If you really want to ban this commenter, please write down the reason:

    If you really want to disable all recommended stories, click on OK button. After that, you will be redirect to your options page.