The UK economy has been emerging from the recessionary economic conditions, under the guidance of the new Government, but things may be about to change. The UK Budget is next week and the rumours are that there will be tax hikes and budget cuts. The latest is a rumour of expanded deficits/debt, which can only mean that budget cuts will be more a re-prioritisation of spending, rather than cuts. The cross rate is likely to trade around current levels of 0.5100, save some major changes to UK Budget direction or RBA monetary policy.
Current Level: 0.5110
Support: 0.5000
Resistance: 0.5200
Last week’s range: 0.5080- 0.5120