Pound to New Zealand Dollar (GBP/NZD) Exchange Rate Gains on RBNZ Official Cash Rate Statement

January 28, 2015 - Written by James Fuller

STORY LINK Pound to New Zealand Dollar (GBP/NZD) Exchange Rate Gains on RBNZ Official Cash Rate Statement

Pound Gains Versus New Zealand Dollar (GBP/NZD) as RBNZ Gov Shocks Currency Markets

Update: The Pound gained against the New Zealand Dollar on Thursday despite a fall in UK House Prices. The RBNZ also made its latest interest rate announcement and opted to keep rates on hold at 3.5%. The Reserve Bank of New Zealand shocked forex markets when Governor Graeme Wheeler suggested that the next official cash rate (OCR) decision could move either up or down.

Earlier: The Pound slid against the New Zealand Dollar on Wednesday as ‘Kiwi’ sentiment gained momentum. The New Zealand commodity currency rose against other majors as bets for a US rate hike were adjusted, making riskier currencies more popular. ANZ Bank of New Zealand economist Mark Smith stated: ‘The US Dollar weakened after weak durable goods data and as markets pared back positions ahead of the FOMC. Weakness in durable goods data suggests that business investment likely contracted in the fourth quarter, which looks to slow growth momentum. The issue for markets and policymakers is the extent that the US economic expansion can roll on despite a number of headwinds.’

Latest New Zealand Dollar Exchange Rates

The New Zealand Dollar to Australian Dollar conversion rate is +0.79 pct higher at 0.93520 NZD/AUD.
The New Zealand Dollar to Canadian Dollar conversion rate is -0.56 pct lower at 0.91190 NZD/CAD.
The New Zealand Dollar to Swiss Franc conversion rate is +0.63 pct higher at 0.66837 NZD/CHF.
The New Zealand Dollar to Euro exchange rate is -0.84 pct lower with a conversion rate of 1 NZD equals 0.64346 EUR.
The New Zealand Dollar to Pound Sterling exchange rate today is converting -0.56 per cent lower at 0.48087 NZD/GBP.
The New Zealand Dollar to US Dollar conversion rate is -0.67 pct lower at 0.72724 NZD/USD.

US economic performance can have a massive effect on other currencies, such as the New Zealand Dollar and the Pound, as the ‘Greenback’ is one of the most powerful currencies in the world. The New Zealand Dollar was pressured lower last week as speculation rose that the Reserve Bank of New Zealand could pause in its rate hiking cycle, or even cut borrowing costs. Deutsche Bank commented: ‘Regardless of its true reaction function, we think the RBNZ will fully deliver on the market’s expectation of significantly more dovish rhetoric at this point. In this scenario, NZD would likely weaken further. The fact that the rates market has re-priced the RBNZ outlook aggressively should not be a barrier to further weakness.’

Pound to New Zealand Dollar Rate Today

Meanwhile, the Pound is trading tentatively in the run up to May’s general election. Politician Ed Milliband and Prime Minister David Cameron are stepping up their games as the main contenders for the PM position. One of the major sources of debate has been the future of the NHS. Both parties have used the NHS as part of their campaign in vying for votes. Milliband has said that Cameron ‘totally betrayed’ the promises made before the last election. Milliband continued: ‘the country’s most precious institution faced its most perilous moment in a generation. David Cameron says he cares about the NHS but that is not enough. What tuition fees is for Nick Clegg, the NHS has become for David Cameron. It has become a question of trust.’

Over the rest of the week, New Zealand Building Permits and Net Migration ecostats are out on Thursday followed by domestic Money Supply data on Friday. The Pound could be impacted by the UK Consumer Confidence figure on Friday, which is expected to increase from -4 to -2.

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