Pound New Zealand Dollar Exchange Rate Hits New Peak but ‘Kiwi’ Remains Strong Too
Investors have been buying the Pound New Zealand Dollar (GBP/NZD) exchange rate since markets opened this morning, and the pair has struck its best levels since last year. Optimism around Britain’s coronavirus recovery outlook is keeping the pair high.
GBP/NZD has remained a volatile exchange rate though. Last week saw GBP/NZD open at the level of 1.9253 and spend much of the week lower, before recovering and closing at the level of 1.9305.
This morning though, GBP/NZD has already seen a surge in demand. At the time of writing, GBP/NZD is trending close to this morning’s three-month best level of 1.9452. This was the pair’s best level since November 2020.
New Zealand data could boost NZD in the coming days. Both the Pound and New Zealand Dollar will continue to be influenced by coronavirus developments as well.
Pound (GBP) Exchange Rates Strong but BoE’s Bailey Urges ‘Cautionary Realism’
Investors continue to bet that the UK economy will be one of the first major economies to recover from the coronavirus pandemic. This has led speculative long bets in the Pound to reach their highest levels in three years.
While weakness in the US Dollar (USD) is benefitting many riskier currencies, the Pound is once again one of the most appealing on the market today.
The Pound saw additional support amid comments from Bank of England (BoE) Governor Andrew Bailey. While Bailey did urge ‘cautionary realism’ and noted life may not return to pre-pandemic normality any time soon, his outlook was optimistic overall.
He also said that the path of joblessness would likely be smoother than previously expected, due to the government’s continued support for the furlough scheme.
New Zealand Dollar (NZD) Exchange Rates Hit by US Dollar’s Surging Rebound
Investors piled into the US Dollar (USD) last week, amid progress in US fiscal stimulus and some stronger than expected US data.
As the US Dollar is a safe haven currency and is often a rival to the New Zealand Dollar, the ‘Kiwi’ has been hit by this US Dollar rebound.
A lack of fresh developments in New Zealand data or coronavirus news is also limiting the New Zealand Dollar’s appeal, following weeks of generally strong performance.
Market optimism around recovery from the pandemic is still generally high. As a result, the New Zealand Dollar outlook is quite strong overall, despite current losses.
Pound New Zealand Dollar (GBP/NZD) Exchange Rate Could be Knocked by Strong Kiwi Data
This week’s economic calendar will be a little quieter, but some noteworthy New Zealand data due in the coming sessions could cause some exchange rate movement if it surprises investors.
Tomorrow’s Asian session will see the publication of New Zealand’s Q4 manufacturing sales results. Business confidence data from ANZ will follow.
Then during Friday’s Asian session, New Zealand business PMI data for February will be published.
If these stats impress investors, the New Zealand Dollar is more likely to strengthen and claw back some ground against the appealing Pound.
Friday will also see the publication of this week’s slew of UK ecostats. UK trade balance, production and growth rate results from January will be published.
Of course, any developments in the UK or New Zealand coronavirus situations will also remain influential for Pound New Zealand Dollar (GBP/NZD) exchange rate investors.
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