Pound to New Zealand Dollar Exchange Rate Outlook: GBP/NZD Higher on BoE Rate Hike Expectations

May 12, 2014 - Written by John Cameron

STORY LINK Pound to New Zealand Dollar Exchange Rate Outlook: GBP/NZD Higher on BoE Rate Hike Expectations

The Pound Sterling to New Zealand Dollar exchange rate (GBP/NZD) advanced on Monday as investors raised their expectations that the Bank of England will begin to raise interest rates in the first quarter of next year.

With a lack of major data releases attention shifted to events later in the week.

Wednesday is the week’s big day for the Pound Sterling and expectations are high that the Bank of England will revise up its growth forecasts when its delivers its quarterly inflation report.

A separate report is expected to show that unemployment in the UK fell again in the first quarter ending in March. The overall unemployment rate is forecast to fall to a more than five year low figure of 6.8% from the previous figure of 6.9%. Wage growth is also expected to experience a rise.

Also due on Wednesday is domestic data out of New Zealand. The nation’s first quarter retail sales data is expected to show that sales growth declined by 0.5% from 1.2%.

Reserve Bank of New Zealand governor Graeme Wheeler is also scheduled to speak on Wednesday. Investors will be watching his comments closely for any insight as to the pace of interest rate rises.

The New Zealand Dollar made gains against the Euro on Monday after the single currency continued to be under pressure from last week’s comments made by European Central Bank President Mario Draghi who suggested that the bank could introduce new monetary easing measures at next month’s policy meeting.

New Zealand Dollar Exchange Rates (NZD) Today (12:00 GMT 12/05/2014)

The Pound Sterling to New Zealand Dollar exchange rate is trading up +0.16% at 1.95798 GBP/NZD.
The Euro to New Zealand Dollar exchange rate is trading down -0.06% at 1.59461 EUR/NZD.
The US Dollar to New Zealand Dollar exchange rate is trading down -0.03% at 1.15927 USD/NZD.
The Canadian Dollar to New Zealand Dollar exchange rate is trading up +0.09% at 1.06477 CAD/NZD.

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TAGS: Forecasts