Quiet Week ahead could Close with GBP/NZD Exchange Rate Decline
The Pound (GBP) has fallen by -0.3% against the New Zealand Dollar (NZD) today, trading at a level of NZ$1.9286.
This is a near a one-week high in the GBP/NZD exchange rate, but the week ahead might not see repeat gains for Pound Sterling.
This is mainly down to a severe data shortage – the only major economic news to speak of will be the GfK consumer confidence reading out on Friday (31st August).
The reading will measure changes to consumer sentiment levels in August and is currently tipped to show a worsening of an already-negative reading.
If GfK’s confidence score shifts from -10 points to -11 as economists expect then the GBP/NZD exchange rate could drop.
Low confidence levels can lead to reduced high-street spending and lower investment levels, so the implications of a bad reading could drain demand for the Pound.
UK PMI Slowdown could Bring Future GBP/NZD Exchange Rate Losses
Looking further ahead, the Pound to New Zealand Dollar (GBP/NZD) exchange rate could see additional movement on the first week of September from UK PMI data.
UK manufacturing, construction and services PMI data for August will be released over 3rd September to 5th September.
Manufacturing sector growth has been forecast, but a converse slowdown in construction and services sector activity has also been predicted.
These latter results could lower confidence among GBP traders, as they might imply UK economic difficulties during August.
None of the PMIs are expected to fall into contraction, but at a time of high GBP trader uncertainty, any signs of a slowdown could still cause Pound losses.
New Zealand Dollar to Pound Forecast: Will Low Business Confidence Cause GBP/NZD Exchange Rate Decline?
A New Zealand Dollar (NZD) to Pound (GBP) exchange rate rise next week isn’t guaranteed, as late-week NZ confidence data could trigger NZD/GBP losses.
The coming Thursday will bring an ANZ business confidence reading for August, which previously printed at -44.9 points.
Business confidence levels have plummeted since a change of government in late 2017 and next week’s readings aren’t expected to show any major improvement.
If August’s business confidence reading shows no signs of rising out of the negative range, NZD trader confidence could drop on the coming Thursday.
Could NZD/GBP Exchange Rate Recover on Higher Dairy Prices?
Further ahead, the New Zealand Dollar (NZD) to Pound (GBP) exchange rate could rise sharply on 4th September when global dairy price data is due out.
The Global Dairy Trade price index measures changes to dairy prices and previously showed a -3.6% drop.
If the next reading proves more supportive and shows a sharp rise in dairy prices then the New Zealand Dollar could advance against the Pound.
Higher dairy prices improve conditions for NZ dairy farmers and exporters, so rising dairy prices could be enough to cause NZD/GBP exchange rate gains next week.
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