The rebounding UK economy may have hit a brick wall, with the advent of the Labour Governments first Budget. The Budget was a toxic combination of increased taxes, increased spending and greater deficits and debt. This is the recipe for disaster and are already being suffered, as witnessed in last week’s plunging GDP growth reading. Economic growth tumbled and now attention turns to UK inflation. If UK inflation reverses recent trends and heads north again, that spells ‘Trouble’. The cross-rate volatility has been limited as the AUD has suffered precipitous loses, along with the GBP.
The current interbank midrate is: AUDGBP .5140 GBPAUD 1.9455
The interbank range this week has been: AUDGBP .5090-.5140 GBPAUD