Investors favour pound over aussie

The pound gained over a cent in value against the Australian dollar yesterday as improved risk appetite in the market favoured the higher risk pound.

• News that China’s manufacturing sector expanded in May for the third consecutive month boosted optimism in markets.
  
• The FTSE 100 had a positive day, following earlier gains in Asia, finishing the day 2% up as investors risk appetite grew.
  
• As widely forecast, the Reserve Bank of Australia kept their interest rate on hold at 3% overnight – the central bank did however suggest that there is scope for further easing of interest rates in the future, which may put the Aussie under selling pressure.