- UK currency appreciates despite continued UK Referendum clashes
- ‘Leave’ group presents economists supporting ‘Brexit’
- ‘Kiwi’ rallies after RBNZ votes to hold interest rate
- UK loan data and range of Eurozone contributions due tomorrow
The Pound (GBP) has been in a position of strength against its peers overall today, with gains potentially stemming from a fairly soft retort by the ‘Out’ campaign in the UK Referendum to the latest developments supportive of the ‘In’ camp.
The New Zealand Dollar (NZD) has advanced against rivals thanks to the outcome of two high-impact central bank interest rate decisions.
UK Economic News: ‘Out’ Campaign Fights Back, UK House Prices Fall
The Pound’s (GBP) favourable movements today have included 0.4% against the US Dollar (GBP/USD), 0.5% against the Israeli New Shekel (GBP/ILS) and 0.7% against the Mexican Peso (GBP/MXN). On the other side of the equation have been losses of -0.2% against the New Zealand Dollar (GBP/NZD) and -2.7% against the Japanese Yen (GBP/JPY).
The only real domestic developments of note for the UK lately have been the Nationwide house prices figures on the month and year in April; in both cases, the declines recorded have exceeded forecasts, in the form of drops from 0.7% to 0.2% and from 5.7% to 4.9% on the year.
Away from ecostats, the Pound has also been moved today by a rare quantifiable announcement from the ‘Leave’ campaign that a group of 8 economists, including Capital Economics founder Roger Bootle and former Treasury Special Advisor Warwick Lightfoot, have put across their case for leaving the EU.
One of the group members, Professor Patrick Minford, summarised the argument for a ‘Brexit’ by saying:
‘The reality is that under a World Trade Organisation (WTO) agreement, the UK will be far better off. Walking away from the EU, not negotiating a new agreement…or putting up any new trade barriers will bring about a 4% gain in GDP.’
While a drop in the ocean compared to the ‘In’ campaign’s support and figures, the estimate nonetheless presents a tangible potential outcome for a ‘Brexit’ situation.
New Zealand Dollar (NZD) Recovers in the Wake of Double Interest Rate Freeze
The ‘Kiwi’ (NZD) has managed to appreciate against all of its rivals recently, having been put into this favourable position by both the Reserve Bank of New Zealand (RBNZ) and the Federal Reserve electing to leave their interest rates on hold for April.
In both cases, the rate freeze outcome had been predicted, but the Fed’s lack of action came as a particular relief to New Zealand Dollar investors, given the large amount of breathing room afforded by the gap between now and June’s next Fed interest rate decision.
‘Kiwi’ movements of note today have included 0.2% against the Australian Dollar (NZD/AUD) and the Pound Sterling (NZD/GBP), 0.4% against the Chinese Yuan (NZD/CNY) and 0.5% against the US Dollar (NZD/USD).
Future GBP, NZD Forecast: NZ Business Confidence and UK Loan Stats Out Tomorrow
The next ecostats likely to have an impact on the GBP/NZD exchange rate will come from the New Zealand first, with the NBNZ business confidence result for April expected to come early tomorrow.
Following on from this much later on in the morning will be the last major UK economic announcements of the week, the net consumer credit and mortgage approvals results for March.
Forecasts are for a reprint at 1.3bn for the former field and a rise from 73.9k to 74.4k for the latter.
Current GBP, NZD Exchange Rates
The Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rate was trending in the region of 2.0931 and the New Zealand Dollar to Pound Sterling (NZD/GBP) exchange rate was trending in the region of 0.4780 today.
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