With increasing likelihood that New Zealand dairy farmers will face water restriction amid El Nino weather patterns, the Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rate rallied by around 0.40%. Compounding Sterling gains has been an unchanged result in the Shop Price Index, which equalled the previous figure of -1.9%.
The Pound Sterling to New Zealand Dollar exchange rate is currently trending in the region of 2.0133.
The New Zealand Dollar has softened over the past few days as the chances of an El Nino weather pattern, which leads to dry conditions, increased significantly. This could have a dangerous knock-on effect on dairy farmers who face a water shortage.
‘We are conscious that milk output may come back a bit as we go through summer’ in the Southern Hemisphere, said Doug Steel, senior economist at Bank of New Zealand Ltd. in Wellington. ‘An El Nino pattern usually hits agricultural production and the electricity sector via the lack of cheap hydro generation, so it’s a drag on GDP.’
Yesterday…
Whilst the US Dollar continues to trend higher against nearly all of its major peers, the Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rate advanced by around 0.38%. Compounding the ‘Kiwi’ (NZD) declination has been disappointing domestic data and a bearish commodities market. The Pound, however, has softened against many of its major rivals as a result of cooling construction output.
The Pound Sterling to New Zealand Dollar exchange rate is currently tending in the region of 2.0080.
Soft British Construction Hurts the British Pound (GBP)
The Pound has slumped against nearly all of its major peers as a result of a disappointing result from construction data. The UK Construction PMI was forecast to soften from 61.4 to 61.0, but the actual result dropped to 59.4.
David Noble, Group Chief Executive Officer at the Chartered Institute of Procurement & Supply, said; ‘As the UK Government announces more detail around road expansion plans, this may add to the pressure on suppliers and their ability to meet the needs of the sector. Though delivery times from suppliers have lengthened, procurement and supply chain managers paint a picture of general optimism amongst the economic doomsayers as the index remains well above the no change mark.’
The Pound Sterling to New Zealand Dollar exchange rate has hit a low today of 1.9930.
New Zealand Dollar (NZD) Declines on Overdone Gains
Over the past few days the New Zealand Dollar has enjoyed a bullish run but, after domestic data printed poorly on Tuesday, the ‘Kiwi’ (NZD) has softened significantly. Most of the declination is as a result of traders fearing that the surge was unwarranted and paring gains as a consequence. November’s Commodity Price index for New Zealand dropped from -0.8% to -1.6%.
Pound Sterling to New Zealand Dollar (GBP/NZD) Exchange Rate Forecast to Strengthen
Whilst traders hold off from investing in the New Zealand Dollar, the GBP/NZD exchange rate is likely to continue trending higher. With that being said, however, Tuesday evening’s Value of All Buildings is forecast to increase, which could give the ‘Kiwi’ a boost.
The Pound Sterling to New Zealand Dollar exchange rate has advanced to a high today of 2.0051.
New Zealand Dollar (NZD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
New Zealand Dollar,
,US Dollar,0.7831,
New Zealand Dollar,,Euro,0.6294,
New Zealand Dollar,,Pound,0.4997,
New Zealand Dollar,,Australian Dollar,0.9268,
US Dollar,,New Zealand Dollar,1.2770,
Euro,,New Zealand Dollar,1.5886,
Pound Sterling,,New Zealand Dollar, 2.0009,
Australian Dollar,,New Zealand Dollar,1.0790,
[/table]
