Pound to New Zealand Dollar (GBP/NZD) Exchange Rate – ‘Kiwi’ higher on jobs report

Pound to New Zealand Dollar exchange rate chart

The New Zealand Dollar pushed higher against the Pound on Wednesday following the release of a positive jobs report and the release of disappointing UK service PMI data.

The ‘Kiwi’ jumped higher against the Pound overnight and rallied against other peers. Against the US Dollar the currency climbed to a one-week high before easing on Wednesday. Demand for the ‘Greenback’ was underpinned as investors remained cautious in the wake of a broad based selloff in emerging markets.

According to Statistics New Zealand, the number of people employed in the three months leading to December 2013 increased by 1.1% or 24,000, after an additional 28,000 jobs were created in the third quarter. Economists had only been expecting a rise of just 0.6%.

After the report was released the ‘Kiwi’ climbed against the US Dollar but couldn’t maintain gains.

“The details of the report just reconfirm what people already knew; that the New Zealand economy is really strong and the RBNZ is going to have to hike interest rates. Despite positive surprises in almost every aspect of the report the markets took it relatively in their stride and are still focused on external events,” said a senior FX manager at ANZ Bank.

The ‘Kiwi’ managed to push higher against the Pound after the UK currency was weakened by the release of data which showed that service sector activity in the country expanded by its slowest pace in seven months, casting doubt over the UK economy’s outlook. Markit’s services PMI dropped to 58.3 in January, the lowest-level recorded since June, from the 58.8 figure recorded in December.

With no more domestic data due for New Zealand the ‘Kiwi’ will be at the mercy of international factors. Tomorrow promises to create volatility as it sees both the Bank of England and European Central Bank unveil their latest interest rate decisions.