New Zealand Dollar Exchange Rate Today: NZD surged vs Pound, US Dollar & Euro Overnight

Modified: Tuesday, 21 January 2014 11:14 BST - Written by Frank Davies

STORY LINK New Zealand Dollar Exchange Rate Today: NZD surged vs Pound, US Dollar & Euro Overnight

The New Zealand Dollar (currency:NZD) surged strongly against the Pound Sterling (currency:GBP) and many other peers including the US Dollar (currency:USD) and Euro (currency:EUR).

The ‘Kiwi’ climbed after a data report showed that inflation in the small Oceanic nation increased unexpectedly in December. Investors immediately raised their bets that the Reserve Bank of New Zealand could raise interest rates at next week’s policy meeting.

According to Statistics New Zealand, the consumer price index increased by 0.1% in the fourth quarter of 2013. The rise followed a 0.9% rise in the third quarter. On a year to year basis the index was up by 1.6% the highest level recorded since 2012. Economists had been forecasting that the CPI would show a rise to 1.5%. The headline number was driven by more expensive international and domestic airfares, and has heightened the chances of a rate hike when the Reserve Bank reviews monetary policy next week.

As a result of the data release investors now see a 63% chance that the Central Bank will increase its cash rate from the current level of 2.5% to 2.75% when it gathers next week for its policy meeting next Thursday.

The Pound is likely to recover ground if the CBI Business Optimism Index comes in positively later in the morning. Economists are expecting the report to show that optimism in UK business climbed to its highest level in 20 years in the final quarter of 2013.

Sterling is also expected to find support from Wednesday’s UK unemployment data which is expected to fall closer to the Bank of England’s target of 7%.

Important New Zealand Dollar Exchange Rates (11:00 GMT 21/01/2014)

The Pound Sterling to New Zealand Dollar exchange rate is trading up +0.17% at 1.97922 GBP/NZD.
The Euro to New Zealand Dollar exchange rate is trading up +0.06% at 1.63028 EUR/NZD.

The US Dollar to New Zealand Dollar exchange rate is trading up +0.12% at 1.20436 USD/NZD.
The Swiss Franc to New Zealand Dollar exchange rate is trading down -0.16% at 1.31830 CHF/NZD.
The Canadian Dollar to New Zealand Dollar exchange rate is trading down -0.36% at 1.09401 CAD/NZD.
The Australian Dollar to New Zealand Dollar exchange rate is trading down -0.13% at 1.05759 AUD/NZD.

International Money Transfer? Ask our resident FX expert a money transfer question or try John's new, free, no-obligation personal service! ,where he helps every step of the way, ensuring you get the best exchange rates on your currency requirements.

TAGS: American Dollar Forecasts Daily Currency Updates Dollar Po Forecasts