FX News: GBP USD Exchange Rate Forecast to Fall; Pound Kiwi Drops GBP NZD

August 26, 2015 - Written by Toni Johnson

STORY LINK FX News: GBP USD Exchange Rate Forecast to Fall; Pound Kiwi Drops GBP NZD

Markets Calm after Black Monday, Pound Sterling (GBP) Conversion Rate Fluctuates

As conditions returned to near-normality following Monday’s severe volatility in the global financial markets, investors took the opportunity during yesterday’s session to eyeball the latest data releases.

Many thousands of articles have been written regarding the world’s second largest economy – China – during the past week, but the main economic figure yesterday came from the world’s premier economic superpower. Analysts had been anticipating that the August edition of the closely-monitored US Consumer Confidence survey would show a marginal increase from July’s print of 90.9. The drastically better than anticipated result of 101.5 therefore triggered renewed support for the US Dollar (currency : USD), which had been having a poor week of it up to this point.

US Data Supports Greenback: GBP-USD Falls from Best Conversion Rate

The upshot saw the Pound Sterling US Dollar exchange rate pull back from its intraday high of 1.5817 GBP USD down into the 1.5600s. The re-basing of the Buck was fuelled by an amendment of investors’ expectations regarding the likely timing of the first interest rate hike of a fresh bout of policy tightening from the US Federal Reserve. A near-term American interest rate increase had appeared highly unlikely during the turmoil of Monday’s session, but the stellar showing from yesterday’s gauge of US consumer confidence sparked renewed talk of a hike, perhaps as soon as next month.

Foreign Exchange ALERT: New Zealand Inflation Expectations Support New Zealand Dollar to GBP Exchange Rate

Elsewhere, there was positive news for one of Monday’s major strugglers during the early hours of yesterday morning when the latest Reserve Bank of New Zealand (RBNZ) 2 Year Inflation Expectation survey for Q3 showed a significant increase from the Q2 edition. The print of 1.94% versus a previous 1.85% suggests that New Zealand’s central bank has limited scope to consider another interest rate cut.

Further Losses Forecast for GBP-NZD Exchange Rate as Risk Appetite Returns

The New Zealand Dollar (currency : NZD) benefitted from the release, sending the Pound Sterling Kiwi Dollar exchange rate back down to just above the 2.4000 threshold – the pair had briefly changed hands at above the 2.5200 level during pre-trade in New York yesterday. Analysts forecast that there may be further losses to come for GBP NZD today if risk appetite continues to pick up in the global markets.

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TAGS: Daily Currency Updates Dollar Pound Forecasts Pound New Ze Forecasts