GBP/AUD Likely to Continue Bearish Moves During Holidays Amid Forecast of Growing Private Sector Credit in Australia

Last Updated on March 18, 2020

Australia – Private Sector Credit

On Monday, at GMT 12:30 a.m., the Reserve Bank of Australia will release the month-over-month Private Sector Credit data. It measures the changes in the total value of new credit issued to consumers and corporations in the country over the previous month.

Binary options traders consider the private sector credit to be an important fundamental indicator of the Australian economy. Because borrowing and spending are highly correlated. Consumers and businesses only take out credit when they feel confident about their ability to pay it back in the future. Hence, it also acts as a measure of consumer and business confidence.

Last month, the private sector credit in Australia increased by 0.1%. The forecast for this month is currently set at an increase of 0.2%.

United Kingdom – High Street Lending

On Friday, at GMT 9:30 a.m., the UK Finance will release the monthly High Street Lending figure. It measures the number of new mortgages approved for home purchase by High Street banks in the last month.

Most home purchases are financed by banks with mortgages. This data makes up around 65% of the UK’s total mortgages. Hence, binary options investors consider the UK’s High Street Lending figure to be leading indicator of the housing market.

Last month, the UK’s High Street Lending figure came out at 41,200. This month, it will likely increase to 41,500.

GBP/AUD Forecast

The GBP/AUD remained highly bullish since the end of July. Over the last few months, it has climbed up by around 2000 pips. However, last week it started a sharp bearish retracement. As a result, it fell below the support level around 1.8900. Currently, it is trading below this important pivot zone.

The UK’s High Street Lending will likely to increase slightly over the month. However, the Australian Private Sector Credit is set to grow at a higher pace, from 0.1% to 0.2%. We believe it would set a bearish fundamental outlook for the GBP/AUD this week. Therefore, if the GBP/AUD closes below the support near 1.8900, it would likely attract additional bearish momentum in the market.

Hence, Australian binary options traders should look out for trading opportunities below this major support level around 1.8900.

Market Analyst / Trading Consultant at Asif Imtiaz
Market Analyst / Trading Consultant . Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes about various tech and financial topics. You can reach him at contact@asifimtiaz.com
Asif Imtiaz

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