Today (i.e., 25 January 2019) Sterling moved up to $1.31 against the US Dollar. As per the recent market news, the main reason behind this uplift was a recently published report by The Sun newspaper which says that Northern Ireland’s Democratic Unionist Party (DUP) could back the Prime Minister Theresa May on her Brexit deal. Prime Minister Theresa May recently experienced a historic defeat for her Brexit deal when the majority of the British MPs voted against her deal.
At the time of her historical defeat, Ms. May had told that although the House has spoken through its vote, it does not indicate anything about what it does support. On 29 January 2018, the MPs will again vote on alternative Brexit plans, and as per The Sun Newspaper, Northern Ireland’s Democratic Unionist Party could back Prime Minister Theresa May this time. A senior DUP source told The Sun that If Ms. May fails on 29 January 2018 then, in that case, Parliament will take over and any chance of a decent Brexit will be lost. Which is why DUP has agreed to help Ms. May by voting for the Government. If the report by the “The Sun” newspaper is accurate, it is expected that the Sterling could witness further uplift.
Sterling has witnessed many ups and downs in the recent past due to the negotiation on the Brexit deal. It is expected that the Brexit will significantly affect various sectors in the UK, and it is expected that Brexit will lead to chaos in the economy of Britain.
While Sterling was moving up, the Australian dollar witnessed a fall in the morning trade and reached $0.7091 against the US dollar. As per the recent market news, the main reason behind the fall of the US dollar is the National Australia Bank’s decision of raising its variable mortgage rates.
Australian Dollar had a minimal effect from the positive Job data released recently, according to which the employment in Australia increased by more than what was expected in December and the same time the unemployment rate also fell. The number of employed persons increased by 231,000 in December 2018 as compared to November 2018. In December, the number of unemployed persons decreased by 32,000 as compared to the unemployed persons in November. As per the Australian Bureau of Statistics (ABS) the seasonally adjusted unemployment rate plunged to 5.0 percent in December 2018 while the seasonally adjusted number of persons employed increased by 21,600 persons. Further, the net movement of employed in both trend and seasonally adjusted terms is underpinned by around 300k people entering and leaving employment in the month. Despite this news, in the morning trade, the AUD fell to $0.7091 against the US dollar. Recently, the International monetary fund also downgraded the outlook for China growth. This news also had a negative impact on the Australian dollar.
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