The Pound Australian Dollar exchange rate is 0.154% higher on the hour with 1 GBP = 1.6475 AUD.
The Pound New Zealand Dollar exchange rate is 0.124% higher on the hour with 1 GBP = 2.1560 NZD.
The GBP AUD was virtually still yesterday, with the price trading within a range of less than a cent, far smaller than we have come to expect.
With the data calendar quiet and few announcements to offer up direction, this pair was left to float almost aimlessly as the market awaits bigger news.
The Australian Dollar is still very much the currency on form, which is enabling it to creep higher against the pound but a retreat in Asian stocks over night from two-year highs has capped its gains.
In a morning foreign exchange note, the dealing desk at Caxton FX say:
"Just as a note, the Australian dollar has touched its strongest level in more than two years against the greenback but news that the Federal Reserve may opt for a smaller scale QE programme has eased the price this morning.
"Looking ahead it's hard to see where a sterling rally might come from. The aussie's yield advantage is helping it to secure solid demand and with risk appetite also higher than it has been, the price could linger down at these levels for some time yet."
New Zealand Dollar
As with many other crosses yesterday, it was a similar story for this pair with the price holding unchanged as the market searched for direction.
The lack of direction saw sterling cap its recent upward trend but the pound is on the move again this morning, edging towards 2.16 as investors pare back bets of a New Zealand interest rate hike.
The patchy NZ recovery is seen keeping rate on hold into 2011, which is encouraging investors towards the aussie where the pace of growth is likely to increase its yield advantage.
Caxton say:
"This week sees New Zealand trade and household debt figures on Wednesday, whilst building and sentiment data is due for release on Thursday.
"If these numbers continue to paint a picture of a recovery losing steam, sterling could extend its recent gains, albeit steadily."
