New Zealand Dollar to Pound (GBP), Euro (EUR) & US Dollar (USD) firmer following Kiwi data

In a session that promises to generate a fair bit of movement in the markets the Pound was trading lower against the New Zealand Dollar.

The ‘Kiwi’ firmed against Sterling and edged higher against the US Dollar and Euro following the release of mixed data.

Official data released overnight showed that the number of new building consents in New Zealand increased by 8.3% in March, reversing the downward trend recorded in February when consents fell by 1.7%. The data also beat economist forecasts for a rise of 2%.

Further gains were restrained however after a separate report showed that business confidence in the Oceanic nation decreased in April. According to ANZ’s business confidence index, confidence amongst New Zealand businesses edged lower from March’s level of 67.3 to 64.8 this month. The fall was more than the dip to the 66.2 level that economists had been forecasting.

The New Zealand Dollar to Euro exchange rate was also trading stronger as investors grow increasingly nervous ahead of today’s inflation data. Inflation in the 18-member Eurozone is expected to come in below the European Central Banks target level and optimism for a strong improvement over last month’s figure of 0.5% is unlikely following yesterdays weaker than forecast German inflation report.

“The market is cautious about the Euro area consumer price report after the German data came in below consensus. Should the report today surprise to the downside, this would boost bets for additional easing by the ECB and weaken the Euro further,” said a currency strategist at Barclays Plc.

The New Zealand Dollar to US Dollar was also higher as investors remain cautious ahead of the Federal Reserve’s policy statement due tonight. The US Dollar could recover ground later in the day, if this afternoon’s preliminary data on first quarter gross domestic product, as well as the ADP report on private sector job creation and data on manufacturing activity in the Chicago region come in positively.