Leading Investment Bank Sees Pound as a Sell Against the Australian Dollar

Must Read

Leading investment bank JP Morgan has said the Pound to Australian Dollar (GBP/AUD) exchange rate is poised for a sell-off, with its analysts predicting a sharp drop in value for the UK currency.

Pound to Australian Dollar

A strategist at JP Morgan, James Nelligan, said, “China reopening and property market stimulus expectations drove copper to new YTD highs this week. That helped cyclical currencies such as AUD perform. We remain long AUD on crosses against CAD and GBP.”

The prediction comes amid increasingly uncertain economic conditions in both countries, with the Australian economy set to be struck by plunging commodity prices and weak Chinese demand.

The decision of China to abandon its zero-Covid policy has been a boon for the Australian Dollar, with economists predicting higher growth rates in the world’s second-largest economy.

The move by China was seen mainly as an attempt to improve their economic outlook and boost consumer confidence levels, with many analysts expecting the Chinese economy to grow exponentially.

Commodity Market of Australia

The news has also positively affected global commodity markets, boosting prices of essential commodities such as copper and oil, leading to increased demand for the Australian Dollar across global markets.

Raffi Boyadjian, a Lead Investment Analyst at XM.com, said, “The Australian and New Zealand dollars are the best-performing major currencies so far this year, with optimism about China’s reopening being a key factor.”

The China reopening story has been one of the key financial market themes of 2023, with JP Morgan predicting that the Australian Dollar (AUD) could rise even further against other major currencies. With commodity prices continuing to rise and Chinese economic growth expected to accelerate, analysts are increasingly bullish on the AUD’s prospects in the future.

All these factors show a sustained appreciation for the Australian Dollar relative to other major currencies over the coming weeks and months.

- Advertisement -spot_img
Latest News
- Advertisement -spot_img

More Articles Like This

- Advertisement -spot_img