The GBPAUD pair is currently oscillating around 1.7813 after a small reversal. Yesterday, The Pound Sterling to Australian Dollar exchange rate tumbled as improved risk-sentiment has lifted demand for the risk-sensitive AUD and weakened the USD.
Yesterday saw the US Federal Reserve Chairman, Jerome Powell, suggest that stimulus measures would not be removed any time soon. Therefore, this has boosted confidence in the global economy, with the outlook for the US economy – the largest economy in the world – continuing to stabilize.
Jim Reid, an economist, and analyst at Deutsche Bank, commented: ‘Risk appetite showed signs of returning to global markets over the last 24 hours as Fed Chair Powell stuck to his reassuring tone and continued to signal that the central bank would keep policy accommodative for some time to come.’
Added to the above, the rollouts of the Covid-19 vaccines worldwide are also improving the outlook for the global economy’s recovery in the months ahead.
In Australian economic news, today saw the release of the latest Private Capital Expenditure figure for the fourth quarter. The figure has beaten forecasts and rose by 3%, lifting optimism in the outlook for Australia’s economy going forward.
On the technical front, RSI is at 46, 11, 21 DMAs are trending down. The pair is set to resume its downtrend, only a break and daily close above 50% fib at 1.7918 will shift bias to the upside.
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