The Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rate softened by around -0.39% on Thursday morning.
After New Zealand’s trade balance moved from deficit to surplus in January, the ‘Kiwi’ (NZD) strengthened versus most of its major peers. The New Zealand Dollar held gains despite cooling oil prices thanks to increasing dairy prices.
The Pound is generally holding in a position of strength versus the majority of its most traded currency rivals despite mixed data results. The fact that preliminary growth figures met with median market forecast figures has prevented a Sterling declination.
The Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rate is currently trending in the region of 2.0421.
Pound Sterling (GBP) Exchange Rate Holding Steady on Mixed Data
British data produced a mixed-bag of results on Thursday which has seen the Pound holding steady versus most of its major competitors. Fourth-quarter British growth met with preliminary estimates on both a yearly and quarterly basis. However, Business Investment slipped which prevented the Pound from making significant gains.
‘We continue to look for real GDP growth of about 3% year-year-on-year in both 2015 and 2016, with a marked upturn in consumer spending as household real income growth strengthens. The (Bank of England’s) MPC is likely to be patient over tightening and we pencil in the first hike for early 2016,’ added Citi’s economists.
With regard to business investment, the Office for National Statistics said; ‘Given the recent steep fall in oil prices, it might be expected that investment by the oil extraction industry might also fall, as oil production becomes less profitable.’
The Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rate dropped to a low of 2.0398 today.
New Zealand Dollar (NZD) Exchange Rate Strengthens despite Low Oil Price
Although the high-yielding ‘Kiwi’ usually suffers from damp market sentiment, the New Zealand Dollar saw increased demand thanks to positive data and rising dairy prices. January’s Trade Balance eclipsed the median market forecast of a rise from -195 million to -158 million, with the actual result revealing a surplus of 56 million.
Rising dairy prices also supported demand for the South Pacific asset. However, most experts feel the price increase is temporary. ‘Even though prices are starting to pick up … we’re not getting overly excited because it’s essentially the flip side of poor production in New Zealand and that is unequivocally negative for the country,’ BNP economist Doug Steel said.
Pound Sterling to New Zealand Dollar (GBP/NZD) Exchange Rate Forecast to Hold Losses
Given the lack of data to curb the trend, the Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rate is likely to hold losses for the remainder of Thursday. There is the potential for changes with New Zealand’s Building Permits data due for publication late on Thursday evening.
Friday ought to see heightened GBP/NZD volatility with data pertaining to both the UK and New Zealand due for publication.
The Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rate reached a high today of 2.0588.
