Currency News

Daily Exchange Rate Forecasts & Currency News

Pound New Zealand (GBP/NZD) Exchange Rate Falls as US-China Talks Back in Focus

March 25, 2019 - Written by John Cameron

GBP/NZD Exchange Rate Sinks as US-China Trade Hopes Buoy ‘Kiwi’

The Pound New Zealand Dollar (GBP/NZD) exchange rate is down today and is trading within the region of NZ$1.9179 on the inter-bank market.

The New Zealand Dollar (NZD) benefited against the weakened Pound (GBP) today following renewed optimism that the US would once again engage with China over trade talks. This came after US President Trump was effectively cleared of claims of Russian influence during the 2016 elections.

Michael Hirson, an Asia Director at the consulting firm Eurasia Group, commented:

‘The … report isn’t a game changer, but it should encourage China to keep up recent momentum in trying to finalize a deal with Trump. China will still have redlines, and a deal is by no means guaranteed, but the fact that an impeachment looks less likely will be meaningful for Beijing’s calculus.’

China is New Zealand’s largest trading partner, and with the New Zealand’s Prime Minister Jacinda Arden due to return to China next week, this has left many ‘Kiwi’ traders that relations between the two nations could be set to improve.

Mrs Arden said:

‘This is an important visit, New Zealand places a high priority on our relationship with China. I look forward to our ongoing engagement.’

Today will see the publication of New Zealand’s trade balance figures for February, which are expected to decrease.

These will be followed by New Zealand’s imports and exports figures for February, and with any signs of improvement these could provide the ‘Kiwi’ with some further uplift against the Pound.

GBP/NZD Exchange Rate Drops on Diminish Hopes on Third ‘Meaningful Vote’

The Pound, meanwhile, has struggled today as Downing Street has refused to clarify whether there will be a third ‘meaningful vote’ this week, which has left many Sterling traders feeling cautious on fears of a possible no-deal Brexit.

Sterling was further weakened by the news that the DUP’s position of Theresa May’s Brexit deal ‘remains unchanged’ following a telephone call between the DUP leader, Arlene Foster, and Theresa May today.

A spokesman for Theresa May said:

‘The sense I took from the Prime Minister and the Cabinet this morning was of a determination to do whatever it takes to get a deal, so the UK can leave the EU as soon as possible.’

Today also saw the European Commission adding to no-deal concerns, saying that the situation of the UK leaving the EU without a deal was becoming ‘increasingly likely’.

GBP/NZD Forecast: Sterling Could Rise if MPs Concede on May’s Brexit Deal

Pound traders will be looking ahead to tomorrow’s release of the BBA mortgage approvals figures for February. Any signs of improvement could prove Pound-positive.

New Zealand Dollar investors, meanwhile, will be looking further ahead to Wednesday which will see the Reserve Bank of New Zealand announce its interest rate decision, which is expected to hold steady at 1.75%.

However, any comments that the RBNZ could be cutting its interest rate hikes this year could see the NZG/GBP exchange rate begin to fall.

The GBP/NZD exchange rate will, however, be dictated by Brexit developments for the coming week, and any signs of MPs arriving at a consensus – or compromise – over May’s Brexit deal could prove positive for the Pound.

Like this piece? Please share with your friends and colleagues:

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: Currency Predictions Daily Currency Updates New Zealand Dollar Forecasts Pound New Zealand Dollar Forecasts

Comments are currrently disabled