The British Pound (GBP) weakened off 1.9320 (0.5175) against the Australian Dollar (AUD) after UK inflation came in lower than prediction, investors exiting the GBP en masse, the cross reaching 1.9020 (0.5260). UK inflation printed at 4.6% in October y/y coming down from 6.7% as energy prices fell and the UK economy stares at the real possibility they may fall into recession in the next few months. Meanwhile Australian unemployment rose to 3.7% from 3.6% as the number of employed jumped by 55,000 after expectations of a rise of just 22,000. The news sent the AUD lower with price retracing to 1.9220 (0.5200). We continue to expect the GBP to retest 1.9330 (0.5175) – the 3-month low.
The current interbank midrate is: AUDGBP 0.5210 GBPAUD 1.9193
The interbank range this week has been: AUDGBP 0.5175- 0.5250 GBPAUD 1.9047- 1.9323