New Zealand Dollar Exchange Rate Forecast - British Pound GBP to NZD To Climb

Modified: Wednesday, 24 July 2013 09:54 BST - Written by David Woodsmith

STORY LINK New Zealand Dollar Exchange Rate Forecast - British Pound GBP to NZD To Climb

Yesterday’s session in the currency markets brought further evidence that the British economic recovery is building momentum. This time the positive news was from the UK’s combined export industries; the latest UK Trade Index report from the British Chambers of Commerce showed at 118.12 for Q2 – up from Q1’s showing by a healthy 2.9%.

The news suggested that the relatively weak level of Sterling against the majority of the currencies of the UK’s trading partners is starting to have a beneficial effect on Britain’s domestic economy. The report revealed that the level of shipments out of the UK has now grown to its highest level since the global credit crisis broke in 2007/08. In an additional boost for UK PLC, the BCC’s publication revealed that exports from UK firms in the services sector had reached their highest ever level.

The Pound will be afforded further direction tomorrow when the advance version of Q2’s UK GDP figures are released. Analysts are expecting a quarterly level of growth of 0.6%, up from the 0.3% jump in activity which the British economy enjoyed in the three months to the end of March of this year. An increase in economic activity of 0.6% in any three month period represents a respectable level of growth, and if today’s figure does indeed show at this level then the future prospects for Britain would appear to be rosy.

Elsewhere, tonight’s Reserve Bank of New Zealand policy decision proves to have a pronounced effect on the Pound to New Zealand Dollar exchange rate (currency : GBP NZD). It would appear likely that the RBNZ will once again state that it wants a weaker New Zealand Dollar and if the policy statement which accompanies the announcement goes further and reveals that the RBNZ is ready to once again step into the global currency markets in order to actively weaken the Kiwi, then expect GBP NZD to make a renewed run at the two to one threshold.

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