The GBP AUD exchange rate opened the week with manufacturing data for the Australian economy. The July Purchasing Managers Index will also have final figures for the UK economy. A new report said that Australia saw over 3,900 business liquidations last year. Meanwhile, Thursday’s Bank of England policy meeting will be the critical event.
The GBP to AUD rate hovered at 1.7380, finding support at the 1.7200 level.
Bank of England policy meeting in view for traders
This week’s key economic event is Thursday’s Bank of England rate hike meeting. Analysts expect a rate hike of 50 basis points. Still, ING analysts observed that the window for additional hikes is closing as recession concerns increase and supply side pressures indicate easing. Markets scaled back expectations of a peak Bank Rate from 3.5% to 2.9%. Although, it still shows two additional 50bp rate hikes by the end of the year.
The BoE may use the current meeting to take rates from the 1.25% level to 1.5% this meeting, adopting a wait-and-see policy on inflation as it nears its peak prediction of 11%. Or it may be that we see 50bps this week and one more hike of 25bps before year-end to take rates to around 2%.
Australia notes thousands of business liquidations
Australia reported over 3900 liquidations or administrations in the 2021-22 financial year.
The state figures saw 1536 liquidations in NSW, 1022 in Victoria, Queensland 665, WA 350, South Australia 196, 91 for the ACT, 29 for Tasmania and 28 for the Northern Territory. According to the Equifax credit agency, construction companies led the way, with numbers that were 30 per cent higher on the year.
The retail industry was also hard hit with more pain to come, according to forecasts. Retail analyst Geoff Dart, told news.com.au that record-low consumer sentiment, soaring interest rates and cost-of-living pressures are the headwinds for the retail industry; the problem is only beginning. Dart said “fringe players and transient brands” without an established name may face a predicament. In these challenging times, people opt for security, established names, and retailers with a robust omnichannel operation and online presence.
When looking at household income, expenses continue to outpace income. The country is not seeing a real wage increase. Interest rate hikes will only worsen next to wage compression. As a result, people will keep rainy day savings, reluctant to spend in challenging times. He added that high-end retailers would be struck as higher mortgage costs and energy bills eat into discretionary spending in favour of essentials.
The Australian economy will see the latest Ai Group manufacturing index figures, with a final reading for the S&P Global PMI index on Monday.
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.
Please Help Support BeforeitsNews by trying our Natural Health Products below!
Order by Phone at 888-809-8385 or online at https://mitocopper.com M - F 9am to 5pm EST
Order by Phone at 866-388-7003 or online at https://www.herbanomic.com M - F 9am to 5pm EST
Order by Phone at 866-388-7003 or online at https://www.herbanomics.com 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).